A separate reinsurance agreement that is negotiated for a particular risk or insurance policy. The cedant has the option (faculty) of submitting and the reinsurer has the option of accepting or declining individual risks.
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REINSURANCE: Reinsurance of individual risks by offer and acceptance wherein the reinsurer retains the ability to accept or reject and individually price each risk offered by the ceding company.
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UK: Reinsurance on an individual risk basis; the cedant offers the reinsurance to a reinsurer who may accept or decline as he is not bound by a treaty. See FACULTATIVE OBLIGATORY TREATY.
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UK: the reinsurance of risks on an individual basis (contrast treaty reinsurance).
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MEDICAL,USA: Type of reinsurance of an individual risk at the option (the “faculty” either to accept or reject) of the insurance company requiring reinsurance.