Question

________________ are also known as Working Excess of Loss covers and are used to reduce the insurer’s loss in respect of a single risk.

a.

Ultimate net loss

b.

Per risk

c.

Catastrophe

d.

Burning cost

Posted under IC85 Reinsurance Management

Answer: (b).Per risk Explanation:Per risk excess of loss is a type of non-proportional reinsurance cover that protects an insurer against large losses on an individual risk. It is also known as working excess of loss covers. The reinsurer agrees to pay a percentage of the loss above a specified amount, which is called the retention or deductible. The purpose of this cover is to limit the insurer's loss on a single risk and to protect its solvency.

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Q. ________________ are also known as Working Excess of Loss covers and are used to reduce the insurer’s loss in respect of a single risk.
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