Question

What is the purpose of sending a "Provisional Notice of Cancellation" (PNC) by reinsurers?

a.

To terminate the contract immediately

b.

To review the arrangement and decide on continuation

c.

To fulfill legal requirements for cancellation

d.

To provide an opportunity for renegotiation

Answer: (b).To review the arrangement and decide on continuation Explanation:The purpose of sending a "Provisional Notice of Cancellation" (PNC) is to give notice of termination and, at the same time, make it "provisional" to enable the reinsurer to review the arrangement and decide whether to continue the contract for the ensuing year.

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Q. What is the purpose of sending a "Provisional Notice of Cancellation" (PNC) by reinsurers?

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