- Table Shaving
- A program used by direct writers which allows substandard risks, typically Table 2 to Table 4, to be placed as standard risks. Table shaving is usually used with
permanent products only. Maximums apply on age and amount, and limitations are set on the types of impairments allowed. The reinsurer typically either loads up the rates of the standard risk class or simply uses the same rates that they charge for substandard risks.
- The formal ending of a reinsurance agreement by its natural
expiry, cancellation or commutation by the parties.
Terminations can be either on a cutoff or runoff basis. Under
cutoff provisions, the parties' obligations are fixed as of the
agreed cutoff date. Otherwise, obligations incurred while the
agreement was in force are run off to their natural extinction.
- Trade Ratio
- See Combined Ratio.
- The written contract defining the reinsurance agreement. The
treaty contains provisions defining the terms of the agreement
including specific risk definition, data on limits and retention,
and provisions for premium payment and duration.
- Trivial Amount
- See Minimum Cession.
- Trust Agreement
- An agreement under which certain assets are deposited by one party
(the grantor), for the sole benefit of another party (the
beneficiary), into an account managed by a third party (the
trustee). In reinsurance, such an agreement is typically
established to permit a licensed ceding company to take credit for
non-admitted reinsurance up to the value of the assets in trust.
Glossary of Reinsurance Terms compiled by
the American Council of Life
and presented by Findalink.net
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