Question

When a reinsured goes into liquidation, what liability does the reinsurer have?

a.

Liability to pay the reinsured's debts

b.

Liability to pay the original insured's claim

c.

Liability to pay the reinsured's share of liability

d.

Liability to pay the liquidation expenses

Answer: (c).Liability to pay the reinsured's share of liability Explanation:In cases where the reinsured goes into liquidation, once the insolvent insurer's liability to pay a claim has been established, the reinsurer is liable to pay its share of the liability as determined.

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Q. When a reinsured goes into liquidation, what liability does the reinsurer have?

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