Language providing a means of resolving differences between the reinsurer and the reinsured without litigation. Usually, each party appoints an arbiter.
The two thus appointed select a third arbiter, or umpire, and a majority decision of the three becomes binding on the parties to the arbitration proceedings.
A Clause within a reinsurance agreement providing that if the Ceding Company and the reinsurer fail to agree, then they select neutral arbitrators with the authority to bind both parties to a solution.
Generally, this is in lieu of a judicial settlement.