Insurance Company Reinsurance Definition
A business that provides coverage in the form of compensation resulting from loss damages injury treatment or hardship in exchange for premium payments.
Insurance company reinsurance definition. Reinsurance is insurance that an insurance company purchases from another insurance company to insulate itself at least in part from the risk of a major claims event. Meaning the person body or company giving reinsurance cover. A reinsurance treaty in which a ceding insurer transfers a lump sum of its premiums to a reinsurer and over time is returned a portion of the unused premiums. Once a claim is made the reinsurer gives the fixed amount to the insurance company.
The company that purchases the reinsurance policy is called a ceding company or cedent or cedant. Insurance company a company which may be for profit non profit or government owned that sells the promise to pay for certain expenses in exchange for a regular fee called a premium. 14 people found. It is a form of risk management primarily used to hedge against the risk of a contingent or uncertain loss.
Time and distance policy. Insurance is a means of protection from financial loss. Coinsurance plan of reinsurance refers to a situation in the insurance industry where an insurance company transfers a financial responsibility to a reinsurer regarding a life insurance policy. For example if one purchases health insurance the insurance company will pay for some of the client s medical bills if any.
It is a process whereby one entity the reinsurer takes on all or part of the risk covered under a policy issued by an insurance company in consideration of a premium payment in other words it is a form of an insurance cover for insurance companies. Definition of insurance company. Definition of reinsured reassured ceding company direct co primary or original insurer. My premium to the insurance company because now all that damage will be repaired and the cost will be covered by the insurance company.
Unlike co insurance where several insurance companies come together to issue one single risk reinsurers are typically. On the other hand reinsurance is used by the insurance company when it does not want to bear the entire risk and shares the risk with another insurer. With reinsurance the company passes on cedes some part of its own insurance liabilities to the other insurance company. That responsibility is a portion of the death benefit.
Insurance is a very common form of financial protection which is used to provide protection against the risk of losses. Life reinsurance is an insurance practice where one insurance company purchases its own insurance contract to insure themselves against a significant loss to a large group of their current life insurance clients policies. An entity which provides insurance is known as an insurer insurance company insurance carrier or underwriter a person or entity who buys insurance is known as an insured or as a policyholder.
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