Brokered and direct reinsurance About reinsurance Reinsurance is a very specific sector in the sphere of insurance. A complex business, it allows insurers to cover their risks by ceding them to a reinsurer. In this context, the reinsurer is obliged to indemnify the ceding company in the event of a claim.The principles of reinsurance Reinsurance is a contract under which a company, the reinsurer, agrees to indemnify an insurance company, the ceding company, against all or part of the primary insurance risks underwritten by the ceding company under one or more insurance contracts. Reinsurance differs from insurance primarily in terms of its inherent complexity, which is linked to its broader range of activities and international nature. Reinsurance can provide a ceding company with several benefits, including a reduction in net liability on individual risks and catastrophe protection from large or multiple losses. Reinsurance also provides ceding companies with the necessary capacity to increase their underwriting capabilities, in terms of both the number and size of risks.
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