A contract of reinsurance is one by which an insurer procures a third person to insure him against loss or liability by reason of such original insurance.
The ContractReinsurance
Section § 620
This law section defines a reinsurance contract. It occurs when an insurance company arranges for another party to take on the risk of loss or liability from the original insurance policy. Essentially, it helps insurers manage their risks by sharing them with other insurers.
reinsurance contract insurer loss protection
Section § 621
This law says that a reinsurance agreement is usually seen as a way to provide financial protection against potential liabilities, rather than just covering actual losses.
A reinsurance is presumed to be a contract of indemnity against liability, and not merely against damage.
reinsurance contract of indemnity liability protection
Section § 622
If an insurance company gets reinsurance, it has to share all the important information and representations from the original insurance policyholder. This includes anything the insurer knows that could affect the risk, whether they learned it before or after setting up the reinsurance.
Where an insurer obtains reinsurance, he must communicate all the representations of the original insured, and also all the knowledge and information he possesses, whether previously or subsequently acquired, which are material to the risk.
insurer's duty reinsurance original insured
Section § 623
The original insured, or the person who holds the initial insurance policy, does not have any rights or stake in any reinsurance contract that the insurer might have.
The original insured has no interest in a contract of reinsurance.
original insured reinsurance contract insurance policyholder
