Page 17 - M1_Insurance Introduction Notes
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Many insurers could not resist offloading their
worst risks onto reinsurers, or charging reinsurers
excessively for the cost of acquiring business. For a
while, it looked as if the new business idea was turning
into a complete failure. Only gradually did the industry
come into its own through much stricter underwriting
discipline, such as Swiss Re’s, and by adopting a
business model, introduced by Munich Re, which
allowed cedents to share in the success of reinsurers.
Why insurance is prone to fraud?
The idea of insurance took birth thousands of years
ago. Yet, the business of Insurance, as we know it
today, goes back just two or three centuries. It may be
called a child of the industrial revolution.
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