REINSURANCE-TREATY

Automatic portfolio reinsurance cover.

Definition

Treaty types: Quota Share (Q/S, portfolio percentage), Surplus (cession beyond retention), XOL Cat (catastrophe excess of loss), XOL Per Risk. Annual renewals 1/1 (Jan 1), 1/7 (July 1). Main markets: Lloyd s London, Bermuda, Munich Re, Swiss Re, Hannover Re, SCOR, Berkshire Hathaway Re.

Origin

Concept developed in the 19th century ; Cologne Re founded 1846 (first formal reinsurer).

Example in context

Allstate cedes 50% of its Florida homeowners portfolio via Q/S 50/50 to Munich Re ; renewed January 1 each year.

Related terms

• Reinsurance Facultative — case-by-case twin.