Carter on Reinsurance (5th Edition) (eBook)

Look Inside

Published Date

July 2013

Also available in other formats:

Carter on Reinsurance (5th Edition) (eBook)

(Excludes any applicable taxes)

Carter on Reinsurance 5th Edition, is essential reading for professionals who work in the insurance and reinsurance industry and need to understand the global changes.

Be the first to review this product

Written by Robert Carter, Nigel Ralph and Les Lucas, this 5th edition of the definitive text on Reinsurance has been brought right up to date. Now in two volumes contained neatly within their own slip case ‘Carter on Reinsurance – 5th Edition’ contains the fundamental coverage of reinsurance practice which makes it indispensable among industry professionals. Readers should gain an in depth guide to the methods and practices which are changing the face of reinsurance.


Authors: Robert Carter, Nigel Ralph and Les Lucas

1. The Role and Development of Reinsurance

2. Types of Market

3. Principles and Practice of Reinsurance

4. Legal Principles Applicable to Reinsurance Contracts

5. Forms of Reinsurance

6. The Pricing of Non-life Reinsurance Contracts

7. Facultative Reinsurance

8. Proportional Reinsurance Treaties

9. Non-proportional Treaties

10. Fixing Retentions

11. Property Reinsurance

12. Catastrophe Reinsurance

13. Casualty, Personal Accident and Other Non-marine (Except Property) Reinsurance

14. Marine and Aviation Reinsurance

15. Life Reassurance

16. Finite Risk Reinsurance and Alternative Risk Transfer

17. Technical Accounting

18. Financial Accounting and Management

19. The Management of Reinsurance Operations

20. International Practice and Problems



Preface to the Fifth Edition


When the fourth edition was published in 2000, no one could have foreseen the series of events that led to major changes in reinsurance markets and practice, notably:


1. The terrorist attack on New York’s World Trade Center in 2001, which made governments, insurers and reinsurers reassess how to respond to the demand for insurance against the risk of terrorism.


2. The frequency of the super catastrophes in one year in the USA, with the 2005 hurricanes Rita, Wilma and Katrina that massively damaged New Orleans, making it necessary to revise catastrophe models for estimating potential losses.


3. Developments in information technology and electronic trading.


4. The 2008 international financial crisis that necessitated the US Federal Government rescuing AIG, the world’s largest insurance company, although unlike the banks the financial crisis did not seriously undermine the security of insurers and reinsurers.


5. The European Union Solvency II Directive that put into effect capital adequacy rules for insurers and reinsurers.


6. The London Market Reforms that gave effect to “contract certainty”.


7. The WTO (World Trade Organization) negotiations under the terms of the General Agreement on Trade and Services which promoted the liberalisation of trade in insurance services leading to a restructuring of insurance and reinsurance markets worldwide.


8. Record natural hazard catastrophes in 2011 (notably the flooding in Australia and Thailand, the earthquakes in Christchurch, New Zealand, the Japanese earthquake and tsunami, and the American tornadoes) that led to record insured losses estimated by Swiss Re at $116bn, leaving Lloyd’s with an overall loss of £516m for 2011 compared with a profit of £2,195m in 2010.


Over the past 12 years, the provision of reinsurance has become a more complicated business than ever before. Undoubtedly, the large natural and manmade catastrophe losses and the hugely costly legal liability claims, particularly associated with asbestos, have caused reinsurers and reinsurance brokers to examine and assess risk much more carefully, and that has led to additional and new resources being brought into play. Non-life actuaries now play a significant and prominent part in the risk assessment and pricing process. Catastrophe risk models initiated by reinsurance brokers and specialist companies are hugely influential and indeed are essential requirements for capital adequacy tests. Although the business has become more complicated, it has also become more professional in order to meet the demands of regulators and reinsurance customers, including timely and clearly documented contracts and efficient and prompt response to the payment of claims.

The risk environment does not stand still. Natural catastrophes are to be expected, but the frequency and quantum of unrelated catastrophes are less predictable, as evidenced by the terrorism claims following 9/11 and the 2005 and 2011 catastrophes already noted.


These events had a major impact on the structure and practice of insurance and reinsurance markets internationally. Consequently, every chapter has required revision, some several times over as the decade progressed and new events intervened. Most of the chapters have been substantially revised, but it has remained our aim to keep the book within manageable proportions while remaining an authoritative exposition of the subject, reflecting best practice within the industry.


As we look to the future, we draw lessons from the past. Reinsurance still is and still will be a risk business. The reinsurance market has adapted itself to meet hugely significant challenges in order to continue to provide risk capacity at affordable if not always welcomed prices. It is the challenges of reinsurance that draw to it men and women of intellectual capacity, innovative ability and professional skills, that enable a healthy and competitive reinsurance market to assume and spread insurance risk.


As in the past, we have been greatly assisted by people in all sections of the London Market, including Lloyd’s and company association officials, who have generously spared time to supply us with key information, advice and up-to-date contract wordings, not least Kevin White with the catastrophe chapter, Charlotte Warr with technical accounting, Nick Ayers with credit and bonding, Andrew Hedges with marine excess of loss, and David Hurst with aviation. We are particularly indebted to the named persons who have undertaken the revision of chapters: Robert Merkin the chapter on legal principles, Ron Wheatcroft the life reassurance chapter, John Philpott the financial accounting chapter, and John Cooke for the international practice and problems chapter. Also we must thank Standard & Poor’s and Marsh Consulting for allowing us to use data from their reports. Finally we thank our long-suffering wives for their forbearance!

Professor Robert L Carter OBE, BSc (Econ), DPhil, FCII, FIRM Emeritus Professor of Insurance Studies, University of Nottingham

Bob Carter started his career with the Norwich Union Fire Insurance Society, then became Assistant Insurance Manager for the Dunlop Rubber Co Ltd. In 1963, he moved into education as a Lecturer in Insurance and Economics at Brighton College of Technology (now Brighton University).

In 1969, he was appointed Lecturer in Industrial Economics at the University of Nottingham, subsequently being promoted to Senior Lecturer. In 1975, he was appointed the Norwich Union Professor of Insurance Studies, a post he held until he retired in 1990. He has lectured around the world and acted as a consultant to the Association of British Insurers, Lloyd’s, the OECD, the World Bank, and other bodies. He is the author of many books and articles on insurance, reinsurance and risk management, including textbooks for the Chartered Insurance Institute.

He was awarded an OBE in 1991 for services to insurance education and the insurance industry.

Leslie D Lucas, FCII, ACIArb

Throughout his career, Leslie has worked in the City of London. In 1960, he joined the Friends Provident and Century Group in the City Accident Department of the Century, which taught him accident insurance. In 1966, he moved to Sun Life to join its newly formed subsidiary Household & General and in 1972 he changed track to reinsurance when he joined the Mercantile & General Reinsurance Company to become an Assistant Accident Manager. In 1977, Leslie moved to the Norwich Winterthur Reinsurance Corporation (NW Re) to be the Casualty Excess of Loss Treaty Underwriter and in 1989 was appointed General Manager.

He was a member of the Reinsurance Officers Association executive and a founder member of the Council of the London Insurance & Reinsurance Market Association (now the International Underwriting Association). He was also a member of Sir David Walker’s Committee that reported on the Lloyd’s LMX problems.

In 1994, Leslie joined Pool Re to take up the position of Chief Executive until he left full-time employment in 2000. Since then, Leslie has been involved in reinsurance education, including authoring parts of some of the CII study courses and serving as an arbitrator in reinsurance disputes. In 1996, Leslie co-authored Reinsurance Management and later co-authored Reinsurance, Fourth Edition (2000) and Reinsurance Essentials (2004).

Nigel Ralph, BA, FCII

Nigel studied French and Spanish at Nottingham University before completing a teaching certificate at Cambridge. In 1979, he joined the Mercantile & General Reinsurance Company in London, working in various marketing and underwriting roles. In 1983, he won the CII’s Bain Dawes scholarship and spent three months working in the Mexican market. He was representative in Japan from 1987 to 1988. Nigel joined ACE Global Markets to underwrite property and agricultural business in the London Market, and later joined Lloyd’s as an Executive in the Underwriting Performance Management Directorate.

Title: Carter on Reinsurance (5th Edition) (eBook)
Number of Pages: 372
Product Code: WS1368EA
ISBN: ISBN 13: 978-1-85609-552-5 (9781856095525), ISBN 10: 1-85609-552-5 (1856095525)
Published Date: July 2013
Author: Robert Carter, Nigel Ralph and Les Lucas

Bought this product? Why not review it?

If you have a question about this product, please contact us directly.

Windows eBooks:


To access the eBook, you need to install our free Windows eBook Reader.

The application can be downloaded from:


Standalone eBooks are supplied with 1 licence + 1 backup and are not transferable between platforms.


Remote Desktop Services (Terminal Services) and virtual environments are not supported.


The Windows eBook Reader works with Windows XP or later OS (but not Windows RT).

See more details.


Cloud (online) eBooks:


The Cloud (online) eBooks use Microsoft Silverlight browser plugin to deliver the best possible reading experience with the ability to work in offline mode.


It is an annual subscription service (i.e. each eBook is purchased for 1 year of use).

Online licences are not transferrable to Windows or iPad (or vice-versa).


Silverlight is compatible with the major web browsers used on Windows and Mac OS X operating systems.

However it is not supported on Linux, Android, Windows RT and iPad devices and therefore the Cloud eBooks use an HTML site in these instances.

The HTML site is more restricted than the Silverlight version.


See and more details.


Note for Mac Users:


Mac users can read Windows eBooks with Boot Camp or using virtual machines such as Parallels Desktop, Virtual Box, ...

Alternatively, Cloud (online) eBooks are accessible on Mac, including the Silverlight plugin with offline mode.


Note for Linux Users:


Linux users can read Windows eBooks using a virtual PC.

Alternatively, the HTML version of the Cloud (online) eBooks is accessible.


Note for Tablet Users:


Tablets owners can use the HTML version of the Cloud (online) eBooks.


Look Inside Text