Page 158 - Liability Insurance IC74

The Insurance Times

Clause 4.2 extends the indemnity to the officers,
Committees and members of the Insured's canteen,
social, sports, medical, fire fighting and welfare
organizations in their respective capacities as such. In
the event of death of such persons to be indemnified,
the indemnity is still available to the personal
representatives of the estate of such person, i.e their
legal heirs.

Q10. (a) Give reasons why excess of loss treaty
Ans. reinsurance is popularly used for Public and
Employer's liability insurance.
Repeat of Q7 of May 2008

Excess of Loss Treaty is a non- proportional
arrangement, i.e the premium and loss are not shared
by the reinsurer in the same proportion. Excess of Loss
Treaty is an arrangement where liability of the reinsurer
is limited up to a certain predetermined amount of loss
borne by the ceding company, which is known as the
Underlying Limit.

This limit is the specific limit up to which the ceding
company will bear all the losses on its net account. The
ceding company decides on the maximum amount of
loss due to any one cause or event that it is prepared to

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