Quota reinsurance

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With quota reinsurance (QRV), the reinsurer has a fixed percentage, the quota, of all the risks written.

definition

Quota reinsurance is a form of proportional reinsurance contract. Here, the reinsurer is liable for a fixed maximum percentage of all risks in the primary insurer's total portfolio in the reinsured segment.

Premiums - and damage payments are divided according to the agreed rate (the former minus a ceding commission). The share of the primary insurer is called the deductible. If the reinsurer has a quota of 30%, he will have a 30% share in every loss (of the risks insured in the reinsurance contract ) that the primary insurer has to cover. In this case, the deductible for the primary insurer is 70%. The QRV is a proportional (pro rata) reinsurance .

  • The risks in reinsurance are divided equally between the primary insurer and the reinsurer.
  • The reinsurer's liability limit is set at an absolute level.
  • The primary insurer's deductible and the reinsurer's share are set as a percentage.
  • If there are several reinsurers, each one bears a fixed share, either of the total risk or as a percentage of the assignment .

Advantages and disadvantages

Advantage of a QRV:

  • Low administrative costs for the reinsurance company, since the acquisition, calculation, contract management and claims processing are carried out by the primary insurer. A reinsurance commission for these administrative expenses is set as a share of these costs.
  • To a certain extent an improvement in the solvency situation of the primary insurer.

Disadvantage of QRV:

  • For the primary insurer, this is a relatively expensive form of reinsurance, since parts of all risks are passed on to the reinsurer, even though it could cover many risks entirely from its own financial resources. However, it is a (usually) comprehensive risk transfer .

literature

  • Joachim von Bernstorff: The quota reinsurance . Cologne / Neuss 1953, OCLC 73921092 .
  • Dieter Farny: Measures to reduce the underwriting risk . In: Concise dictionary of the insurance HdV . Verlag Versicherungswirtschaft, Karlsruhe 1988, ISBN 3-88487-162-5 , p. 655-704 ( books.google.de ).
  • Werner Schwilling: The functions of quota reinsurance in German property and casualty insurance . In: Journal for the entire insurance science . tape 85 , no. 4 December 1996, ISSN  0044-2585 , OCLC 5656769663 , pp. 651-694 , doi : 10.1007 / BF03188958 .
  • Peter Liebwein: Classic and modern forms of reinsurance . 2nd Edition. Verlag Versicherungswirtschaft, Karlsruhe 2009, ISBN 978-3-88487-794-4 , p. 62–67 ( books.google.de - first edition: 2000, restricted preview).
  • Horst Baumann, Ernst Bruck, Charlotte Echarti, Hans Möller: Types of reinsurance: proportional and non-proportional . In: Insurance Contract Act (=  Großkommentare practice . No. 11 ). 9th, completely revised edition. de Gruyter, Berlin 2013, ISBN 978-3-11-024883-8 , pp. 27–28 ( books.google.de - as of September 2012).
  • Julia Miller: Reinsurance as a risk-reducing tool for the primary insurer . GRIN Verlag, Munich 2014, ISBN 978-3-656-67477-1 , Chapter 4.1.1 Quota reinsurance , urn : nbn: de: 101: 1-201406284426 .

Individual evidence

  1. ↑ a b definition of “quota reinsurance” . In: Fred Wagner (Ed.): Gabler Insurance Lexicon . ( versicherungsmagazin.de [accessed on November 17, 2016]).
  2. ↑ Quota share reinsurance ( PDF, pp. 20/21).
  3. ↑ Quota reinsurance. (No longer available online.) Staufenbiel.de, archived from the original on November 17, 2016 ; Retrieved November 17, 2016 . Info: The archive link was inserted automatically and has not yet been checked. Please check the original and archive link according to the instructions and then remove this notice. @1@ 2Template: Webachiv / IABot / www.staufenbiel.de