What is excess of loss reinsurance in insurance?

Excess of loss reinsurance is a type of reinsurance in which the reinsurer indemnifies–or compensates–the ceding company for losses that exceed a specified limit.

What is XL reinsurance?

XL stands for Excess Loss and describes types of non-proportional reinsurance contracts. The reinsurance pays if the total claims over the given period is above the stated amount (retention level). This could be for a single loss (Cat XL), for a single risk (per risk XL) or in aggregate (Agg XL).

What is an xol?

What is XoL in insurance? An excess of loss policy covers losses that exceed a specified threshold – a loss greater than anything your credit management or regular insurance cover can handle. Your company’s cash flow, balance sheet and very survival could be at risk.

What is xol treaty?

Excess of loss (XOL) agreements provide capacity to write risks larger than a ceding company could justify based on its own surplus. XOL also provides severity protection against large losses and / or an ac- cumulation of losses that might prove disconcerting to the ceding company’s stakehold- ers.

What is excess of loss facultative reinsurance?

Excess of loss reinsurance is a non-proportional form of reinsurance. In an excess of loss contract, the reinsurer agrees to pay the total amount of losses or a certain percentage of losses above a certain limit to the cedent.

What does XL Catlin do?

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Who owns XL insurance?

AxaAxa XL / Parent organization

What is excess policy?

Excess policies, also called secondary policies, extend the limit of insurance coverage of the primary policy or the underlying liability policy. In other words, the underlying policy is responsible for paying any portion of a claim first before the excess policy is used.

What is the difference between stop loss and excess of loss reinsurance?

Definition. Stop-loss reinsurance is a type of excess of loss reinsurance wherein the reinsurer is liable for the insured’s losses incurred over a certain period (usually a year) that exceed a specified amount or percentage of some business measure, such as earned premiums written, up to the policy limit.

What is rol in reinsurance?

Rate on line (ROL) is the ratio of premium paid to loss recoverable in a reinsurance contract. Simply put, ROL represents how much money an insurer must commit in order to obtain reinsurance coverage.

What is pro rata reinsurance?

Pro Rata Reinsurance — the reinsurer receives a percentage of premium and pays a proportional share of losses, above the ceding company’s retention.