In non proportional treaty what ismean by yhis line “premium is not collected on session,but on the whole portfolio of the ceding company.

1 answer

Audit Staff June 13, 2018

Premium is not calculated on each session, but on the whole portfolio of the ceding company.
session means the liability of insurance company is reduced/eliminated and reinsurer company is increased/established.
now in non – proportional treaties single policies are not ceded nor class of policies (like all marine policies etc), in these non-proportional policies re-insurer takes liability to bear losses above certain limit for company as a whole and not individual policy or small group of polices.   
for example re-insurer will bear claims if total business claims crosses 500 crore. so re-insurance company will bear losses not on case to case basis but for business as a whole  

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