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📅 '''Losses occurring during''' is a [[Definition:Reinsurance | reinsurance]] contract trigger basis under which the reinsurer responds to losses arising from events that occur within the defined contract period, regardless of when the underlying [[Definition:Insurance policy | original policy]] was written or when the [[Definition:Claim | claim]] is ultimately reported. Often abbreviated as LOD, this trigger mechanism contrasts with alternatives such as [[Definition:Risks attaching | risks attaching]] and [[Definition:Claims made | claims made]] bases, and the choice between them has significant implications for how coverage is activated, how [[Definition:Premium | premiums]] are calculated, and how [[Definition:Claims reserve | reserves]] are established.

⚙️ Under a losses-occurring-during treaty, the reinsurer covers any [[Definition:Loss event | loss event]] whose date of occurrence falls within the treaty period — say, January 1 to December 31 of a given year — even if the original policy that generated the loss was bound before the treaty's inception. This means the reinsurer has exposure to the entire in-force portfolio of the [[Definition:Ceding company | ceding company]] as of each moment during the contract term, not just to policies incepting during that term. The practical effect is smoother matching between the reinsurance protection and the cedent's aggregate loss exposure in any given calendar year. Pricing an LOD treaty requires the reinsurer to assess the cedent's total earned [[Definition:Exposure unit | exposure]] base during the contract period, whereas a [[Definition:Risks attaching | risks-attaching]] treaty focuses only on the exposure generated by policies bound within the period. Regulatory and accounting frameworks treat the two bases differently: under [[Definition:IFRS 17 | IFRS 17]], for instance, the boundary of the reinsurance contract and the pattern of risk release vary depending on whether the trigger is occurrence-based or risks-attaching, affecting how the [[Definition:Contractual service margin (CSM) | contractual service margin]] is recognized over time.

💡 Choosing between a losses-occurring and a risks-attaching basis is one of the most consequential structural decisions in a reinsurance programme. LOD treaties are favored by cedents seeking immediate protection for their entire portfolio from the moment the treaty begins — there is no gap caused by policies already in force that would fall outside a risks-attaching trigger. This makes the LOD basis particularly common for [[Definition:Excess of loss reinsurance | excess-of-loss]] covers and [[Definition:Catastrophe reinsurance | catastrophe reinsurance]], where the timing of a loss event is the natural trigger. However, the LOD basis introduces complexity around claims that are reported years after the event — a phenomenon especially pronounced in [[Definition:Long-tail insurance | long-tail]] classes such as [[Definition:Liability insurance | liability]] and [[Definition:Asbestos and environmental (A&E) | asbestos and environmental]] lines. To manage this, treaties typically include a [[Definition:Sunset clause | sunset clause]] or reporting deadline that limits how long after the contract period a loss can be notified to the reinsurer. Across major reinsurance hubs — from the [[Definition:Lloyd's of London | London market]] and Continental European treaty centres to Singapore and Bermuda — the LOD basis remains the dominant structure for non-proportional covers.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Risks attaching]]
* [[Definition:Claims made]]
* [[Definition:Excess of loss reinsurance]]
* [[Definition:Treaty reinsurance]]
* [[Definition:Catastrophe reinsurance]]
* [[Definition:Sunset clause]]
{{Div col end}}

Definition:Losses occurring during - Revision history

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