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📅 '''Risks attaching during''' is a [[Definition:Reinsurance | reinsurance]] contract basis under which the reinsurer covers all policies incepting (or "attaching") within the defined treaty period, regardless of when [[Definition:Claims | losses]] under those policies actually occur. If an underlying [[Definition:Insurance policy | policy]] begins during the treaty term — say, a twelve-month [[Definition:Treaty | treaty]] running from January 1 to December 31 — the reinsurer remains liable for claims arising from that policy even if the loss event happens after the treaty's expiration date. This stands in contrast to the [[Definition:Losses occurring during | losses occurring during]] basis, where coverage depends on when the loss event takes place rather than when the underlying policy incepted.

⚙️ Under a risks-attaching treaty, the [[Definition:Cedant | cedant]] cedes every qualifying policy that incepts during the treaty period, along with its corresponding [[Definition:Reinsurance premium | premium]] and [[Definition:Loss | loss]] obligations. Because some of these policies may run well beyond the treaty expiration — a policy incepting on December 15 of the treaty year, for instance, could generate claims twelve months later — the reinsurer's exposure can extend significantly past the nominal treaty term. This "tail" of liability requires careful [[Definition:Reserving | reserving]] and is a key consideration in [[Definition:Reinsurance pricing | reinsurance pricing]] negotiations. The risks-attaching basis is commonly used in [[Definition:Proportional reinsurance | proportional treaties]] such as [[Definition:Quota share | quota share]] and [[Definition:Surplus treaty | surplus share]] arrangements, and is prevalent in markets worldwide, including placements through [[Definition:Lloyd's of London | Lloyd's]], Continental European reinsurers, and Asian [[Definition:Reinsurance | reinsurance]] hubs.

🧩 The choice between risks-attaching and [[Definition:Losses occurring during | losses-occurring]] bases carries significant implications for both parties. For the cedant, a risks-attaching treaty provides certainty that every policy written during the period has reinsurance protection for its full duration, simplifying [[Definition:Underwriting | underwriting]] and [[Definition:Policy administration | administration]]. For the reinsurer, the extended tail means that loss emergence and [[Definition:Loss development | development]] patterns must be modeled carefully, and that final [[Definition:Commutation | commutation]] or settlement of the treaty may occur years after the nominal expiry. Accounting treatment also differs: under [[Definition:IFRS 17 | IFRS 17]] and various local [[Definition:Generally accepted accounting principles (GAAP) | GAAP]] standards, the earned premium and loss recognition patterns for risks-attaching treaties follow the underlying policy periods, which can create timing differences compared to losses-occurring contracts. Understanding this distinction is essential for anyone involved in structuring, pricing, or accounting for reinsurance programs.

'''Related concepts:'''
{{Div col|colwidth=20em}}
* [[Definition:Losses occurring during]]
* [[Definition:Treaty]]
* [[Definition:Proportional reinsurance]]
* [[Definition:Quota share]]
* [[Definition:Cedant]]
* [[Definition:Reinsurance premium]]
{{Div col end}}

Definition:Risks attaching during - Revision history

PlumBot: Bot: Creating new article from JSON