Reinsurance for the Beginner, 5th Edition

Published Date

April 2003

Reinsurance for the Beginner, 5th Edition

(Excludes any applicable taxes)

This publication explains the basic elements of the business of reinsurance and includes numerous worked examples of reinsurance calculations and typical policy wordings. It is aimed primarily at students and newcomers to the industry, but will also help financial advisers, accountants, lawyers and regulators gain a working knowledge of the subject.

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This explanatory publication examines the construction and application of reinsurance, rather than the usage of any particular market.

Chapter 1 – Introduction

Chapter 2 – Facultative

Chapter 3 – Treaties

Chapter 4 – Proportional Treaties

Chapter 5 – Quota Share Treaty

Chapter 6 – Surplus Treaty

Chapter 7 – Pools and Facultative Obligatory Treaty

Chapter 8 – Non-Proportional Reinsurance

Chapter 9 – Event Excess of Loss

Chapter 10 – Risk Excess of Loss

Chapter 11 – Catastrophe Excess of Loss

Chapter 12 – Stop Loss and Aggregate Excess of Loss

Chapter 13 – Reinsurance Planning – Basic Principles

Chapter 14 – Reinsurance Planning – Practical Application

Chapter 15 – Basic Contract Wordings

Chapter 16 – Treaty Wordings – Proportional

Chapter 17 – Contract Wordings – Excess of Loss

Chapter 18 – Developments since the 4th Edition

The function of an insurance company is to protect the original insured against potential heavy losses. The reinsurer provides a similar protection to the insurance company.


Reinsurance therefore plays a very important, if not a vital, role in the insurance industry. That role can be summarised under three headings:


  1. 1. Providing Capacity
  2. 2. Creating Stability
  3. 3. Strengthening Finances.



Providing Capacity


The provision of capacity is the primary reason for reinsurance.


In every branch of insurance there are risks where, because of their size or their nature, an insurance company cannot afford to keep the whole of the insured value for its own account. Such risks are numerous: oil rigs and jumbo jet aircraft are some of the best examples.


In certain insurance markets, large risks are insured on a sharing basis by several different insurance companies, all operating in that particular market. Each insurance company takes a share of the risk that it can absorb, and the remainder is insured with other insurance companies.

Philippe Bellerose, FCII, CDipAF, was a Director and General Manager of the Sydney Reinsurance Company Pty Ltd, a member of the QBE Insurance Group Ltd, Australia. He was in reinsurance for some 25 years, the last 15 being as Reinsurance Manager of the QBE Group, which operates in 26 countries.

Christopher Paine, DipCII, formerly of Reinsurance Evaluations Ltd, revised and updated this 5th Edition following the death of Philippe Bellerose.

Title: Reinsurance for the Beginner, 5th Edition
Number of Volumes: 1
Number of Pages: 285
Product Code: 4405Q034
ISBN: ISBN 13: 978-1-85609-239-5 (9781856092395), ISBN 10: 1-85609-239-9 (1856092399)
Published Date: April 2003
Binding Format: Paperback
Book Height: 235 mm
Book Width: 155 mm
Book Spine: 10 mm
Weight: 0.60 kg
Author: Philippe Bellerose, FCII, CDipAF and Christopher Paine, DipCII

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