What is overriding commission in reinsurance?
A fee or percentage of money which is paid to a party responsible for placing a retrocession of reinsurance.
In insurance, a fee or percentage of money which is paid by the insurer to an agent or general agent for premium volume produced by other agents in a given geographic territory..
What is a reinsurance contract called?
Reinsurance is also known as insurance for insurers or stop-loss insurance. Reinsurance is the practice whereby insurers transfer portions of their risk portfolios to other parties by some form of agreement to reduce the likelihood of paying a large obligation resulting from an insurance claim.
How many types of reinsurance contracts are there?
two typesFacultative reinsurance and reinsurance treaties are two types of reinsurance contracts. When it comes to facultative reinsurance, the main insurer covers one risk or a series of risks held in its own books. Treaty reinsurance, on the other hand, is insurance purchased by an insurer from another company.
What are the two types of reinsurance?
Types of Reinsurance: Reinsurance can be divided into two basic categories: treaty and facultative. Treaties are agreements that cover broad groups of policies such as all of a primary insurer’s auto business.
What is sliding scale commission in reinsurance?
A sliding scale commission is a percent of premium paid by the reinsurer to the ceding company which “slides” with the actual loss experience, subject to set minimum and maximum amounts.
What is reinsurance and how does it work?
Reinsurance occurs when multiple insurance companies share risk by purchasing insurance policies from other insurers to limit their own total loss in case of disaster. By spreading risk, an insurance company takes on clients whose coverage would be too great of a burden for the single insurance company to handle alone.