A reinsurance broker is an intermediary individual or firm who is paid a fee or commission to find
and place new business on behalf of both the insurance and reinsurance. This can involve
negotiating rates or contracts while sourcing the best-suited services on the market. A reinsurance
broker is a mediator among insurance, reinsurance, and retrocession.
Duties of the reinsurance broker:
This would include
- Duty to obtain cover
- Degree of skill required
- Choice of reinsurers
- Placement of risk: disclosure of risk
- Drafting of the reinsurance contract
- Advice during the life of the contract
- Handling of claims
- Risk Analysis
- Insurance & Reinsurance Program Design
- Accurate & Timely Claims Servicing
- Partnership & Training
- Market Knowledge
- Total Risk Solutions
Insurance is a contract, represented by a policy, in which an individual or entity receives financial
protection or reimbursement against losses from an insurance company.
Reinsurance is a process s whereby the reinsurer takes on all or part of the risk covered under a
policy issued by an insurance company in consideration of premium payment. In other words, it is
an insurance cover for insurance companies.
Retrocession is re-insuring the portion of the risk which is excess of the held by the reinsurer.
As per the Insurance Act of Nepal, “Life Insurance Business” means the business relating to a
contract regarding the life of any person under which he/she or his/her heir in the event of his/her
death will be paid a particular amount in case a specified amount is paid in installments based on
his/her age.
As per the Insurance Act of Nepal, Non-Life Insurance Business” means other Insurance
Businesses are other than the Life Insurance Business.
There are four types of insurance companies in Nepal.
- Life Insurance Company
- Non-life Insurance Company
- Reinsurance Company
- Reinsurance broker
Number of Life, Non-Life Companies in Nepal and Reinsurance Companies
Types of business are done by Life Insurance, Non-life Insurance, Reinsurance companies, and
reinsurance broker. As per the Insurance Regulation, 1993 A.D, Non-Life Insurance companies
can do the following businesses:
- Fire Insurance,
- Motor Insurance,
- Marine Insurance,
- Engineering and Contractor’s Risk Insurance,
- Aviation Insurance,
- Miscellaneous Insurance.
- Micro
- Agriculture
- Risk Capital Improvement and Diversification
- Catastrophic Protection
- To Finance New Business
- Growth in Economy
- Job Creation
Insured takes the policy from the insurance market through insurers, then insurance searches for the
reinsurance broker to have better products and services. After that reinsurance broker has
reinsurance portfolios for selection. From where the reinsurance broker selects the reinsurance
company with better technical analysis to provide product/service to the insurance company.
There type types to the treaty.
- Proportional
- Non-proportional
- Facultative
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