The reinsurance bought by reinsurers to protect their financial stability. A reinsurance of reinsurance. Example: Company “B” has accepted reinsurance from Company “A”, and then obtains for itself, on such business assumed, reinsurance from Company “C”. This secondary reinsurance is called a Retrocession. The transaction whereby a reinsurer cedes to another reinsurer all or part … Read more
To cede insurance risk from one reinsurer to another reinsurer.
Date as specified in declarations or in any endorsement on or after which any wrongful act, as defined in each coverage unit, must have occurred in order for claims arising from it to be covered under a policy. Claims arising from any wrongful act, as defined in coverage units, occurring before this date may not … Read more
The net amount of risk which the Ceding Company or the reinsurer keeps for its own account or that of specified others.
Facilities, such as assigned risk plans and FAIR Plans, that exist to provide coverage for those who cannot get it in the regular market. Insurers doing business in a given state generally must participate in these Pools. For this reason the Residual Market is also known as the shared market.
A form of financial guaranty insurance that protects a lessor against unexpected declines in the market value of leased equipment (automobiles, aircraft, heavy machinery) upon termination or expiration of the lease agreement.
In modified coinsurance, the interest rate used to calculate the amount payable by the Ceding Company in consideration of the reserves being held by the reinsurer. See Mod-co Reserve Adjustment.
A company’s best estimate of what it will pay for claims. Reserves are liabilities for amounts an insurance company is obligated to pay in acccordance with an insurance policy or Annuity contract. Reserves are established for both matured and unmatured obligations of an insurance company. Reserves represent the present value of future expected payments less future expected … Read more
An amount which is set aside to provide for payment of a future obligation.
Agreement between a buyer and seller where the seller agrees to repurchase the securities at an agreed upon time and price. Repurchase agreements involving U.S. government securities are utilized by the Federal Reserve to control the money supply.
