Page 131 - Reinsurance Management IC85

Reinsurance Management

from the incoming business are comparable to
his own loss experience. Emphasis should be
on matching results and not on matching
premium volumes.

vii) Is inward business a part of business from
binding authority? A prudent underwriter will be
careful while giving away his pen to a third
party. An agency may write a large volume of
business regardless of quality to earn extra
commission.

viii) Liability of inward business should always be less
than those of usually written on direct business.

ix) Financially standing of both companies should be
considered.

x) Types of insurance covered and the terms and
conditions of the treaties should be matched in
regard of commission rates, deductibles, reserve
deposits and so on.

Sashi Publications - www.sashipublications.com 129

ight@ The Insurance Times. 09883398055 / 0988338