Question

What is a working excess of loss cover?

a.

A cover that provides protection against small losses

b.

A cover that provides protection against large losses

c.

A cover that costs a pro-rata premium like a quota-share

d.

A cover that is available only for ocean-going vessels

Posted under IC85 Reinsurance Management

Answer: (b).A cover that provides protection against large losses Explanation:It is rare to see an insurer carry high retention protected by a working excess of loss cover because a very substantial portion of the hull premium is required to pay total loss and large partial losses.

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