Excess of Loss Reinsurance
An Insurance Company may enter into an excess of loss reinsurance agreement to limit its retained risk on an insurance policy. The reinsurance contract defines the limit at which the reinsurer assumes coverage in exchange for premium paid by the Ceding Entity. Coverage may be ceded on a per risk, per occurrence or excess aggregate basis, and the Reinsurer assumes the losses and loss adjustment expenses once the claims exceed the Insurance Company’s retention.
This OnDemand Learning session provides examples of how to calculate amounts ceded to the Reinsurer based on what type of excess of loss reinsurance agreement is in place for a sample set of claims data.
