Reinsurance is when an insurance company purchases coverage from another insurer to cover certain risk. In a word its hedging against the exposures. Often companies with limited assets seek reinsurance in the secondary market.
Posted: Wed Jan 14, 2009 01:37 pm Post Subject:
Every carrier has different limits as to what they can/will insure themselves without having another company cover a portion of the benefit. The difficult part about reinsurance is that the "secondary" carrier's underwriting guidelines may be different than the primary carrier. Even the biggest carriers go to reinsurance on large face amount cases, but the amount varies substantially from carrier to carrier.
Posted: Wed Jan 14, 2009 10:37 pm Post Subject: insurance
You mean Insurance companies have a 'back up' plan for a claim which may be a large amount? :roll:
Posted: Wed Jan 14, 2009 10:38 pm Post Subject: insurance
Do ALL Insurance companies have this 'reinsurance'?
Posted: Thu Jan 15, 2009 08:43 am Post Subject:
You mean Insurance companies have a 'back up' plan for a claim which may be a large amount?
Yes, the insurance company if feels that certain loss would affect its profit may try to buy hedge against it. And, would get a reinsurance from the reinsurance company against payment. The insurer and the reinsurance company both would share the premium paid by the policy holder. The reinsurer then would share the loss with the insurance company against the policy.
Do ALL Insurance companies have this 'reinsurance'?
Insurers are increasingly seeking reinsurance against catastrophic disasters. And, apart from the reinsurance companies several institutional investors too are taking interest in the reinsurance business. Hence, we can expect that the reinsurance business will grow in volume in the future.
~Jeremy
Posted: Thu Jan 15, 2009 11:28 am Post Subject:
Basically, the reinsurance allows the insurance company to provide higher limits of insurance to a policy holder than the assets of the insurance company would permit. That way it helps to make the platform more predictable for the insurance provider. Even they need some kind of cushion against major losses.
Posted: Thu Mar 17, 2011 07:05 pm Post Subject: Role of reincurance
what role does reinsurance play in life insurance
Posted: Fri Mar 18, 2011 05:03 am Post Subject:
Reinsurance allows an insurance company (any line of insurance) to write new policies in excess of their actual capital reserves established for the payment of claims and other policyholder liabilities (cash values, paid-in capital) and other expenses of the insurance company (salaries and commissions, other business operating expenses).
Without reinsurance agreements, insurance companies would have been out of business decades ago.
Posted: Tue Apr 05, 2011 12:34 pm Post Subject:
Insurance companies always have a backup plan. Reinsurance is huge and i think its mainly when the amounts are very high.
Posted: Tue Apr 05, 2011 05:42 pm Post Subject:
Reinsurance is hugh and i think its mainly when the amounts are very high
Reinsurance is required by state law because insurance companies do not have the capital reserves to fund 100% of the death benefits they are liable for on any given day if all of the insureds died that day. Without reinsurance, companies could not write new business.
Posted: Wed Jan 14, 2009 11:38 am Post Subject:
Reinsurance is when an insurance company purchases coverage from another insurer to cover certain risk. In a word its hedging against the exposures. Often companies with limited assets seek reinsurance in the secondary market.
Posted: Wed Jan 14, 2009 01:37 pm Post Subject:
Every carrier has different limits as to what they can/will insure themselves without having another company cover a portion of the benefit. The difficult part about reinsurance is that the "secondary" carrier's underwriting guidelines may be different than the primary carrier. Even the biggest carriers go to reinsurance on large face amount cases, but the amount varies substantially from carrier to carrier.
Posted: Wed Jan 14, 2009 10:37 pm Post Subject: insurance
You mean Insurance companies have a 'back up' plan for a claim which may be a large amount? :roll:
Posted: Wed Jan 14, 2009 10:38 pm Post Subject: insurance
Do ALL Insurance companies have this 'reinsurance'?
Posted: Thu Jan 15, 2009 08:43 am Post Subject:
You mean Insurance companies have a 'back up' plan for a claim which may be a large amount?
Yes, the insurance company if feels that certain loss would affect its profit may try to buy hedge against it. And, would get a reinsurance from the reinsurance company against payment. The insurer and the reinsurance company both would share the premium paid by the policy holder. The reinsurer then would share the loss with the insurance company against the policy.
Do ALL Insurance companies have this 'reinsurance'?
Insurers are increasingly seeking reinsurance against catastrophic disasters. And, apart from the reinsurance companies several institutional investors too are taking interest in the reinsurance business. Hence, we can expect that the reinsurance business will grow in volume in the future.
~Jeremy
Posted: Thu Jan 15, 2009 11:28 am Post Subject:
Basically, the reinsurance allows the insurance company to provide higher limits of insurance to a policy holder than the assets of the insurance company would permit. That way it helps to make the platform more predictable for the insurance provider. Even they need some kind of cushion against major losses.
Posted: Thu Mar 17, 2011 07:05 pm Post Subject: Role of reincurance
what role does reinsurance play in life insurance
Posted: Fri Mar 18, 2011 05:03 am Post Subject:
Reinsurance allows an insurance company (any line of insurance) to write new policies in excess of their actual capital reserves established for the payment of claims and other policyholder liabilities (cash values, paid-in capital) and other expenses of the insurance company (salaries and commissions, other business operating expenses).
Without reinsurance agreements, insurance companies would have been out of business decades ago.
Posted: Tue Apr 05, 2011 12:34 pm Post Subject:
Insurance companies always have a backup plan. Reinsurance is huge and i think its mainly when the amounts are very high.
Posted: Tue Apr 05, 2011 05:42 pm Post Subject:
Reinsurance is hugh and i think its mainly when the amounts are very high
Reinsurance is required by state law because insurance companies do not have the capital reserves to fund 100% of the death benefits they are liable for on any given day if all of the insureds died that day. Without reinsurance, companies could not write new business.
It's not a "back up plan", it's the law.
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