Match each reinsurance operational term with its correct function or definition within the risk transfer process.
- Ceding InsurerThe primary entity that originates the policy and transfers a portion of its exposure to another carrier.
- ReinsurerThe entity that accepts a portion of the original risk but maintains no direct legal contract with the original policyholder.
- RetrocessionaireThe entity that accepts a portion of risk from an organization that has already assumed it from a primary carrier.
- Facultative AgreementA risk-transfer arrangement negotiated specifically for an individual, case-by-case exposure.
Answer
Ceding Insurer matches with originating the policy; Reinsurer matches with accepting risk without policyholder privity; Retrocessionaire matches with accepting risk from another reinsurer; Facultative Agreement matches with a case-by-case arrangement.
Each term accurately aligns with its operational function in the risk transfer chain. The ceding insurer retains the primary obligation, the reinsurer assumes risk without policyholder privity, the retrocessionaire acts as a reinsurer to the reinsurer, and facultative describes individual, non-automatic placements.
Step-by-Step Solution
Key Concept
Reinsurance Operational Roles and Risk Transfer Mechanisms
Estimated Time:1m 0s