Reinsurance

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Reinsurance

The spreading of risk and division of client premiums among insurance companies allowing the sharing of the burden of a large risk.

Reinsurance

An insurance policy for insurers. In reinsurance, one insurer cedes a portion of its portfolio of policyholders to another insurer in exchange for paying a fee. There exists the possibility that too many policyholders will make a claim and a single insurer will be unable to pay the benefit without ruining itself. This is especially true for disaster insurance and other similar policies. Reinsurance reduces this risk. It is also called stop-loss insurance.

reinsurance

see INSURANCE COMPANY.
References in periodicals archive ?
It should be remembered that participating as a reinsurer exposes the producer to underwriting risk that would not exist without an insurance company, captive or PORC to reinsure the risk.
The United Casualty Group, an affiliated group, was assigned a 1992 Best's Rating of "A+" (Superior), which applies to The United Casualty Insurance Company and an affiliate that it fully reinsures.
WMA Life currently reinsures certain life insurance policies and annuities sold by a network of independent agents associated with World Marketing Alliance, Inc.
Currently, WMA Life reinsures solely the mortality risk on the variable life business subject to the conversion option.
WMA Life reinsures certain life insurance policies and annuities sold by a growing network of independent agents associated with World Marketing Alliance, Inc.
Mountain Valley's A++ rating is currently derived from its participation in an intercompany reinsurance agreement between Trinity Universal and Mountain Valley, under which Trinity substantially reinsures Mountain Valley's business, affording similar operating performance and financial strength.