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 ?
When you visit the site, look for the Who Reinsures What icon and click on it for access to the online edition of this publication.
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.
Look for the Who Reinsures What logo and click on it for access to the online edition of this publication.
Nichido Fire reinsures 90% of Nichido Pacific's business.
OTCBB:HTVL), a leading pet health insurance company in the United States, announced today that it will assume 40% of the underwriting risk on its pet insurance program for 2003 and that the balance of the risk--60%--will be assumed by reinsures who are among the largest in the industry.
In addition, the company benefits from its global market presence and a broad product mix, as it provides liability insurance; reinsures life, health and general insurance; and participates in various life and accident retrocessions.