Question

What is a "Treaty" in the context of reinsurance?What is the meaning of "Uberrimae Fidei"?

A reinsurance agreement between the reinsured insurer and the reinsurerAn insurance policy clause that limits liability

A retroactive pricing mechanism for excess of loss reinsuranceA contractual term describing proportional reinsurance

An insurance policy issued by the reinsurer to the ceding insurerA principle of utmost good faith applicable to reinsurance relationships

An agreement between primary insurance insurers for retrocession purposesA method of calculating ultimate net loss

Posted under IC85 Reinsurance Management

Answer: A reinsurance agreement between the reinsured insurer and the reinsurerA principle of utmost good faith applicable to reinsurance relationships Explanation:A "Treaty" can be defined as a reinsurance agreement between the reinsured insurer and the reinsurer. It specifies the technical particulars applicable to the reinsurance of certain classes of business. Reinsurance treaties can be classified as participating type or excess type, depending on whether they involve sharing of liability, premiums, and losses or indemnity for losses exceeding a predetermined amount."Uberrimae Fidei" can be defined as a defining characterization or quality of certain contractual relationships, including reinsurance. It emphasizes the importance of mutual trust and a strong consideration for the interests of the other party, even if they conflict with one's own. A breach of utmost good faith, particularly regarding the disclosure of risk elements, can lead to reformation or redress.

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Q. What is a "Treaty" in the context of reinsurance?What is the meaning of "Uberrimae Fidei"?

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