Fire Catastrophe Reinsurance
Means used by a direct fire underwriter to protect against accumulation for a fire account, as well as against extremely large fire account liability. For example, heavy liabilities under individual risks can be analyzed by the initial fire underwriter to determine the number of separate fire risks involved. The reinsurance method applied to the risks is a quota share or surplus share treaty with the use of a facultative reinsurance cover if necessary. Under this method, the re-insurer assumes the liability of a proportionate share of the risks in exchange for a proportionate share of the premiums. An extremely large number of losses under individual risks caused by a single event, commonly referred to as a conflagration hazard, arises when different risks may be affected by one fire. An example would be widespread damage to many adjacent private houses. While the loss for each retained individual risk would be small, the aggregate would be so large that it would affect the stability of the fire insurance company. Catastrophe reinsurance would protect any surplus reinsurance and excess of loss reinsurance up to a stated amount.
Popular Insurance Terms
Modified collateral split dollar life insurance plan under which the employee purchases and owns a life insurance policy on the employee's own life. The employer makes the unscheduled ...
Section of a policy that specifies the dollar amount or percentage of any loss that the insurance does not pay. Most property and medical policies specify that the first portion of any loss ...
Coverage in which an insurer is not bound to cede and a reinsurer is not bound to accept a risk. A separate reinsurance contract covers each cession. The contract is automatically renewed ...
Trust instrument that permits the owner of a residence (grantor) to transfer ownership of that residence with the grantor still being allowed to stay in that residence for a stipulated ...
a contract in life insurance that includes elements of whole life and term insurance. in pensions, a combined life insurance policy and a side (auxiliary) fund to enhance the amount of a ...
Activities of interest in underwriting an application for life insurance to determine the rate classification (premium) for the applicant. For example, a sky diver is at greater personal ...
In marine insurance, clause giving an insured the right to abandon lost or damaged property and still claim full settlement from an insurer (subject to certain restrictions). Two types of ...
Insurance written for a period of time greater than one year. ...
Type of logic that makes the assumption that what has happened in the past will happen in the future, given the same conditions surrounding the two occurrences. In other words, "History ...
Have a question or comment?
We're here to help.