Strike-through Clause (cut-through Clause)
Provision that holds a re-insurer liable for its share of losses even if the ceding company becomes insolvent before paying these losses. For example, XYZ Insurance Co. writes a fire policy for Acme Manufacturing and then re-insures 80% of the risk with ABC Reinsurance. XYZ is declared insolvent. Then Acme Manufacturing burns to the ground. ABC Reinsurance would be responsible for the 80% of the risk it re-insured and would pay the claim directly to Acme.
Popular Insurance Terms
Return of a percentage of premium paid by a business firm if its loss record is better than the amount loaded into the basic premium. ...
Same as term Excess of Loss Reinsurance: method whereby an insurer pays the amount of each claim for each risk up to a limit determined in advance and the reinsurer pays the amount of the ...
Type of inland marine insurance that provides coverage for jewels, watches, gold, silver, platinum, pearls, precious and semiprecious stones. Property can be owned by the insured jeweler, ...
Monetary fund established to pay for claims that the insurance company is aware of (claims incurred or future claims) but that the insurance company has not yet settled. This reserve is ...
Assets, such as furniture and fixtures, that are not permitted by state law to be included in an insurance company's ANNUAL STATEMENT. ...
Same as term Tabular Plans: retrospective rating system with basic, minimum, and maximum premium rates listed in manual tables. Calculation of an individual premium involves adjusting the ...
Group that monitors government health insurance programs. Authorized by the 1972 amendment to the Social Security Act, PSROs were set up to cut costs and minimize abuses by checking on the ...
Prospective insured who completes and signs a written form containing personal statements about himself/herself. ...
Same as term Ceding Company: insurance company that transfers a risk to a reinsurance company. ...
Have a question or comment?
We're here to help.