Question

Which of the following is a normal method of reinsurance in miscellaneous accident business?

a.

Per risk basis

b.

Per event basis

c.

Excess of loss basis

d.

Surplus basis

Posted under IC85 Reinsurance Management

Answer: (d).Surplus basis Explanation:In miscellaneous accident business, surplus basis is a normal method of reinsurance. Surplus basis refers to the amount of insurance that is ceded to the reinsurer over and above the retention limit of the insurer. This method provides coverage for losses that exceed the insurer's retention limit. The reinsurer agrees to accept a portion of the surplus, which is the amount of insurance above the retention limit. The reinsurer is responsible for paying a share of any losses that occur within this surplus coverage.

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Q. Which of the following is a normal method of reinsurance in miscellaneous accident business?
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