Insurance Awareness - Reinsurance
In which type of reinsurance does the reinsurer indemnify the insurer only when losses exceed a pre-agreed retention limit?
In which type of reinsurance does the reinsurer indemnify the insurer only when losses exceed a pre-agreed retention limit?
medium Q5 of 15
Step-by-Step Solution
Step 1: Understand indemnification above retention
Non-proportional reinsurance covers losses only when they exceed a specified retention or threshold.Step 2: Exclude other types
Proportional and quota share share premiums and losses in fixed ratios; facultative is risk-by-risk acceptance.Final Answer:
Non-Proportional Reinsurance → Option CQuick Check:
Only non-proportional reinsurance involves indemnity above retention limits.
Quick Trick: Non-Proportional = Excess of Loss coverage.
Common Mistakes:
MISTAKES- Confusing proportional with non-proportional reinsurance.
Master "Reinsurance" in Insurance Awareness
Start learning the concept with an interactive lesson.
Want More Practice?
15+ quiz questions · All difficulty levels · Free
Free Signup - Practice All QuestionsMore Insurance Awareness Quizzes