Insurance WAEC

Re-Insurance

Akopọ

Who insures the insurer? When a Lagos company accepts a fire risk on a ₦2 billion refinery, it cannot afford to pay that claim alone if the plant burns down. So it does exactly what its own customers do: it passes part of the risk to someone bigger. That someone is a reinsurer, and the arrangement is called re-insurance, the quiet machinery that lets ordinary insurers safely accept risks far larger than their own pockets.

In this lesson you will learn what re-insurance really is and how it moves risk from one insurer to another, the difference between facultative and treaty cover, and how a single risk is carved up under quota share and surplus treaties. You will work through the splits examiners set, see why re-insurance is not the same thing as co-insurance, and meet the reinsurers that keep the Nigerian market standing.

Awọn Afojusun

  1. Define re-insurance and explain how it transfers risk from one insurer to another
  2. Distinguish facultative from treaty re-insurance
  3. Explain the functions of re-insurance, including capacity, stability and catastrophe protection
  4. Describe the uses of re-insurance in the Nigerian insurance market
  5. Distinguish re-insurance from co-insurance

Akọ̀wé Ẹ̀kọ́

A medium sized insurer in Port Harcourt is asked to cover an oil storage depot for ₦900,000,000. Its entire capital could not settle a total loss of that size, yet it does not want to turn the business away. The way out is re-insurance: the insurer accepts the whole risk to keep the client, then immediately passes most of it to a reinsurer. Master this one idea and you understand how a small company can safely write a giant risk, why insurers rarely collapse after a single disaster, and how the Nigerian market keeps premium income at home.

Ìdánwò Ẹ̀kọ́

Oriire fun ipari ẹkọ lori Re-Insurance. Ni bayi ti o ti ṣawari naa awọn imọran bọtini ati awọn imọran, o to akoko lati fi imọ rẹ si idanwo. Ẹka yii nfunni ni ọpọlọpọ awọn adaṣe awọn ibeere ti a ṣe lati fun oye rẹ lokun ati ṣe iranlọwọ fun ọ lati ṣe iwọn oye ohun elo naa.

Iwọ yoo pade adalu awọn iru ibeere, pẹlu awọn ibeere olumulo pupọ, awọn ibeere idahun kukuru, ati awọn ibeere iwe kikọ. Gbogbo ibeere kọọkan ni a ṣe pẹlu iṣaro lati ṣe ayẹwo awọn ẹya oriṣiriṣi ti imọ rẹ ati awọn ogbon ironu pataki.

Lo ise abala yii gege bi anfaani lati mu oye re lori koko-ọrọ naa lagbara ati lati ṣe idanimọ eyikeyi agbegbe ti o le nilo afikun ikẹkọ. Maṣe jẹ ki awọn italaya eyikeyi ti o ba pade da ọ lójú; dipo, wo wọn gẹgẹ bi awọn anfaani fun idagbasoke ati ilọsiwaju.

  1. Re-insurance is best described as: A. The sharing of one risk among several insurers who all face the insured B. The transfer by an insurer of part of a risk it has accepted to another insurer C. The payment of a claim by instalments D. Insurance taken out by a member of the public Answer: B
  2. In a re-insurance transaction, the insurer that passes on the risk is known as the: A. Reinsurer B. Ceding company C. Retrocessionaire D. Lead insurer Answer: B
  3. An insurer holds a 30 per cent retention, 70 per cent cession quota share treaty. On a claim of 20,000,000 naira, how much does the reinsurer pay? A. 6,000,000 naira B. 14,000,000 naira C. 20,000,000 naira D. 7,000,000 naira Answer: B
  4. Which type of re-insurance is obligatory, so that the insurer must cede and the reinsurer must accept every qualifying risk automatically? A. Facultative B. Treaty C. Retrocession D. Co-insurance Answer: B
  5. The process by which a reinsurer re-insures part of a risk it has accepted with another reinsurer is called: A. Retention B. Co-insurance C. Retrocession D. Subrogation Answer: C

Awọn Iwe Itọsọna Ti a Gba Nimọran

Principles of Risk Management and Insurance
Principles of Risk Management and Insurance
Atunkọ: Thirteenth edition
Olùtẹ̀jáde: Pearson
Odún: 2016
ISBN: 978-0-13-408257-8
Apejuwe: The standard introduction to risk and insurance, covering risk management, insurer operations and the main lines of life, health, property and liability cover.
Fundamentals of Risk and Insurance
Fundamentals of Risk and Insurance
Atunkọ: Tenth edition
Olùtẹ̀jáde: Wiley
Odún: 2008
ISBN: 978-0-470-08753-4
Apejuwe: A clear account of the nature of risk and the economics of insurance, written for beginning students across life, health, property and liability insurance.
Fundamentals of Insurance
Fundamentals of Insurance
Atunkọ: Second edition
Olùtẹ̀jáde: Himalaya Publishing House
Odún: 2017
ISBN: 978-93-5097-079-9
Apejuwe: An accessible treatment of insurance in four parts: the basics of risk, insurance management, life insurance and non-life insurance.

Àwọn Ìbéèrè Tó Ti Kọjá

Ṣe o n ronu ohun ti awọn ibeere atijọ fun koko-ọrọ yii dabi? Eyi ni nọmba awọn ibeere nipa Re-Insurance lati awọn ọdun ti o kọja.

WAEC SSCE - Insurance - 2015

Ibeere 1 Ìròyìn

Explain the following terms as used in insurance.

(a) re-insurance

(b) Loss adjusters

(c) underwriters

(d) brokers

(e) assessor

 

Wo Idahun