https://www.insurerbrain.com/w/index.php?action=history&feed=atom&title=Definition%3ACession 2026-06-13T23:14:32Z Revision history for this page on the wiki MediaWiki 1.43.8 https://www.insurerbrain.com/w/index.php?title=Definition:Cession&diff=6738&oldid=prev 2026-03-10T04:44:25Z

<p>Bot: Creating new article from JSON</p> <p><b>New page</b></p><div>📤 &#039;&#039;&#039;Cession&#039;&#039;&#039; is the act of transferring a specified portion of insurance risk — along with the corresponding [[Definition:Ceded premium | premium]] — from a [[Definition:Cedent | cedent]] to a [[Definition:Reinsurance | reinsurer]]. Each individual transfer constitutes a cession, and together the cessions under a given [[Definition:Reinsurance | reinsurance]] treaty define the total volume and nature of risk that has moved from the primary [[Definition:Insurance carrier | insurer&#039;s]] books to those of the assuming reinsurer.<br /> <br /> ⚙️ How a cession operates depends on the treaty structure. In [[Definition:Proportional reinsurance | proportional]] arrangements such as [[Definition:Quota share reinsurance | quota share]] or [[Definition:Surplus share reinsurance | surplus share]] treaties, each qualifying [[Definition:Policy | policy]] is automatically ceded at the agreed percentage, with [[Definition:Premium | premiums]] and [[Definition:Claim | losses]] shared in the same proportion. Under [[Definition:Facultative reinsurance | facultative reinsurance]], cessions are negotiated on a risk-by-risk basis, requiring separate approval from the reinsurer for each account. The cedent typically reports cessions to the reinsurer on a periodic basis — often quarterly — through [[Definition:Bordereau | bordereaux]] that detail the policies, premiums, and claims included in each reporting period.<br /> <br /> 🧩 Beyond its technical function, the pattern of cessions across an insurer&#039;s portfolio tells a strategic story. Analysts can examine cession rates to gauge how aggressively a carrier is managing its [[Definition:Risk retention | net retention]], whether it is growing into new lines by leaning on reinsurance capacity, or whether it is pulling back from volatile segments. Regulatory frameworks also pay close attention: the volume and quality of cessions — particularly the financial strength of the reinsurers assuming them — factor directly into [[Definition:Solvency | solvency]] calculations and statutory reporting requirements.<br /> <br /> &#039;&#039;&#039;Related concepts&#039;&#039;&#039;<br /> {{Div col|colwidth=20em}}<br /> * [[Definition:Cedent]]<br /> * [[Definition:Ceded premium]]<br /> * [[Definition:Reinsurance]]<br /> * [[Definition:Quota share reinsurance]]<br /> * [[Definition:Facultative reinsurance]]<br /> * [[Definition:Bordereau]]<br /> {{Div col end}}</div>

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