Almost all insurance companies have a reinsurance program in place. Provide 4 reasons why it is...

Almost all insurance companies have a reinsurance program in place. Provide 4 reasons why it is important for a policy holder to make sure that her insurance policy is backed by a strong reinsurance company.

Expert Solution

Reinsurance should be the there in case of insurer want to exit the business pr want to transfer the risk.

In case of insurer want to avoid or deny to pay the insured person, reinsurance company made it possible to safeguard the interest of insured person.

Reinsurance covers in case of large loses like earthquake, recession, tsunami etc.

Reisurance is also known as stop loss for a insurance company i.e. transferring portions of risk portfolios to other parties by some form of contract agreement to reduce the likelihood of paying a large obligation resulting from an insurance claim by a insured person.

jeff jeffy answered 2 years ago

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