Question

What is the E&O clause in a reinsurance treaty?

a.

A clause that specifies the additional policy benefits other than the basic death benefit

b.

A clause that covers the liability of the reinsurers in cases of claims

c.

A clause that details the extent of errors that will be accepted by the reinsurer

d.

A clause that covers the policy terminations, changes or increases in risk classification, reinstatements, etc

Posted under IC22 Life Insurance Underwriting

Answer: (c).A clause that details the extent of errors that will be accepted by the reinsurer Explanation:The E&O (errors and omissions) clause in the treaty details the extent of errors that will be accepted by the reinsurer, which are of unintentional and non-recurring nature.

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Q. What is the E&O clause in a reinsurance treaty?
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