Reply To: Facultative Reinsurance vs Treaty Reinsurance
Mayank Goyal
It is a reinsurance #contract negotiated seperately for each insurance #policy that is reinsured. It is normally purchased by #insurers for individual #risks that are not covered or insufficiently covered by their reinsurance treaties or for #unusual risks.
#Underwriting and administration #expenses are generally higher as compared to treaty reinsurance as risks are individually written.
#Treaty_Reinsurance
It is a reinsurace contract #negotiated by both the insurer and the #reinsurer under which the reinsurer covers the specified #share of all the insurance policies issued by the insurer which come within the #scope of the contract.W
#Administrations expenses are less as compared to facultative reinsurance #agreements.