Funded Cover


Definition of "Funded cover"

Transaction in which the ceding company pays a premium and is guaranteed certain future payments to fund future losses. If losses are less than was expected, the ceding company receives a profit commission. Conversely, if catastrophic losses are occurring at a faster rate than the investment return earned on the premium, the ceding company will not receive its full recovery on its reinsurance.



Search Real Estate Glossary

Related Real Estate Glossary terms

Related Real Estate FAQ