Quota Share
Definition
A proportional treaty where the reinsurer accepts a fixed percentage of all policies within the treaty scope. Simple and automatic coverage.
Practical Example
25% quota share on all personal auto policies written by the cedent.
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Related Terms
Reinsurance where premiums and losses are shared between cedent and reinsurer based on an agreed percentage. Includes quota share and surplus treaties.
A proportional treaty where the cedent retains a fixed amount per risk and cedes the surplus to reinsurers. Provides flexibility for varying policy sizes.
Commission paid by the reinsurer to the cedent on proportional treaties to compensate for acquisition costs and expenses.