Page 95 - Reinsurance Management IC85

The Insurance Times

year are available, the balance of premium less
commission less claims paid or a part of the
balance may be provided as outstanding losses.

e. We may also make an additional "ad hoc" provision
for claim incurred but not reported (IBNR).

None of the above methods will be totally
satisfactory. But a combination of the methods and
consistency of practice will ensure reasonably
adequate provisions.

Q. Explain the importance of periodical review
of treaty acceptances and how such review
is done by the reinsurer.

Ans: For a successful inward reinsurance account, proper
statistics relating to acceptances should be maintained
and made available for review. Reviews of acceptances
are done periodically and in any case, at least, once in
a year, well in advance of the notice period before the
renewal. The essential features of such reviews are
whether

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