1.5.6 Reinsurers
Reinsurance is an arrangement through which one insurance company transfers a portion of a risk it has assumed to another insurer. A reinsurance arrangement provides an arena for sharing loss as a hedge against catastrophic loss to any one company.
A reinsurer relationship occurs when one insurer (the ceding company) transfers or relinquishes a portion of a covered risk to another insurer (the reinsurer).
