Page 317 - Reinsurance Management IC85

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u natural perils accumulations if applicable by
zones;

u whether any policies written on PML basis;

Q9. Briefly describe three options available to an
insurance company which is considering a risk
that it does not have sufficient capacity for,
under its reinsurance programme.

Ans: u It can retain a correspondingly higher amount.
u It can accept less than 100% of the risk by
offering a co-insurance participation (i.e. sharing
the risk with other primary insurers).
u Declining to write the risk.
u It can accept the risk and cede part of the risk
by way of facultative reinsurance.
u Ask the reinsurers for a special acceptance under
an existing treaty/programme.

Q10. What is the purpose of a profit commission
in a reinsurance treaty? List three items

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