Question

What is Excess of Loss reinsurance?

a.

Reinsurance where the reinsurer pays any loss on an individual risk below a predetermined retention

b.

Reinsurance where the reinsurer pays any loss on an individual risk in excess of a predetermined retention

c.

Reinsurance where the reinsurer pays the aggregate net loss over a predetermined retention for a portfolio

d.

Reinsurance where the reinsurer pays for losses from specific catastrophic events

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (b).Reinsurance where the reinsurer pays any loss on an individual risk in excess of a predetermined retention Explanation:Excess of Loss reinsurance involves the reinsurer paying any loss on an individual risk in excess of a predetermined retention.

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