Finite Reinsurance
Definition
- A form of reinsurance where the reinsurer takes on a pre determined and limited amount of risk from the ceding party. With this arrangement, the ceding party receives a measure of protection while the reinsurer can limit its liabilities.
Synonyms
limited reinsurance, restricted reinsurance
Related Terms and Acronyms
- Aggregate Limit of Liability — Definition,
- A restriction on the amount of liability an insured entity can place on an insurer in a specific time period.
- Ceding Party — Definition,
- In reinsurance, a ceding party is an insurance company that spreads liability to a reinsurer in order to lower risk.
- Lloyd's of London — Company,
- A market for insurance and reinsurance based in London, England where Lloyd's members, underwriters and financial backers can spread and share risk.
- Reinsurance — Definition,
- The process of one insurance company sharing liabilities from an insurance policy with another insurance company in order to lessen exposure, or in other words, insurance for insurers.
- Reinsurance Ceded — Definition,
- The amount of insurance that is reinsured with another insurance company.
- Reinsurance Recoverables to Policyholder Surplus — Definition,
- A method used to determine how much an insurer relies on reinsurance.
- Reinsurer — Definition,
- An insurance company that provides coverage for a portion of another insurance company's risk.
- Underlying Retention — Definition,
- The liability an insurance company still retains after ceding liability to a reinsurer.
