In this reinsurance arrangement, both the primary insurer and the reinsurer retain full decision-making powers with respect to each insurance contract.As each insurance contract is issued, the primary insurer decides whether or not to seek reinsurance, and the reinsurer retains the flexibility to accept or reject each application for reinsurance on a case-by-case basis.Identify this arrangement.

Question

Quizplus · Accepted Answer

This describes a facultative reinsurance arrangement, where both the primary insurer and the reinsurer have the discretion to choose which individual risks to insure or reinsure on a case-by-case basis.

In This Reinsurance Arrangement, Both the Primary Insurer and the Reinsurer