Suchergebnisse
Suchergebnisse:
1. Juni 2022 · What is Retroactive Reinsurance? Definition of Retroactive Reinsurance. “Retroactive reinsurance is insurance in which a reinsurer agrees to reimburse a ceding company for liabilities incurred as a result of past insurable events covered under contracts subject to the reinsurance.”
Retroactive reinsurance addresses these challenges by the use of Loss Portfolio Transfer (LPT) or Adverse Development Cover (ADC), or a combination of both solutions, to optimise capital, facilitate operational efficiencies and provide balance sheet relief when you need it.
Retroactive Reinsurance: Reinsurance in which an assuming entity agrees to reimburse a ceding entity for liabilities incurred as a result of past insurable events covered under contracts subject to the reinsurance. A reinsurance contract may include both prospective and retroactive reinsurance provisions.
Retroactive covers as stand-alone solutions are the perfect tool for freeing up redundancies and capital or to ring-fence liabilities. Multi-year solutions Reassure a regulator or rating agency with regard to sustainable capital management while benefiting from smoothing effects over time.
Learn how retroactive reinsurance affects the financial reporting of insurance companies, especially the treatment of ceded and assumed losses. See examples of recent transactions and the accounting implications for runoff agreements, novations, and intercompany reinsurance.
1) Retroactive reinsurance is subject to retrospective accounting by RBC unless specific conditions are met. As a result, RBC reserve risk factors are calculated gross of the retroactive reinsurance treaty recoverables. Prospective accounting treatment is available as permitted practice, or if 1) the counterparty is an affiliate and 2) the
Retroactive = covers past events. The significant terms and conditions need to be agreed upon at the inception of the contract period for contract to be prospective. If not, the contract would be bifurcated into prospective and retroactive or would cause the entire contract to be retroactive.
