Strike-through Clause (cut-through Clause)
Definition of "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
Type of guaranteed investment contract (GIC) under which a single payment is made into an account of an insurance company where it will remain for a stipulated number of years. Both the ...
Range of administrative and risk management services that can be purchased by an insured. Increasingly, insurance can be purchased unbundled so that policy-holders may pay for straight ...
Clause in a reinsurance policy that excludes the reinsurer's liability for losses occurring after a stipulated date. ...
Individual who retains title to property that is being transferred on a temporary basis to the care, custody, and/or control of another. ...
Combination property, liability, and business interruption policy. It is usually written to cover expenses of small and medium size businesses resulting from damage or destruction of ...
Addition to a basic insurance policy to further explain coverages, add or exclude perils and locations covered, and add or delete positions covered. For example, an endorsement to the ...
Dwelling insurance is how it’s called the most obvious coverage type under the homeowner’s insurance umbrella. It deals with the damages done to the physical structure of the ...
Determination that investments by parents in their children's education through the purchase of Series EE Savings Bonds, which generate interest income, are tax-exempt if the proceeds are ...
Type of insurance that provides a single aggregate limit of coverage within the insurance policy terms, thereby limiting the insurance company's liability for a risk transferred to it. The ...
Have a question or comment?
We're here to help.