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Reinstatement Cover

A type of reinsurance that provides a ceding company all or a portion of the ceding company’s contract or program limits that were eroded under a reinstatement clause in the original reinsurance agreement. The reinstatement cover is normally a separate agreement and the term usually incepts immediately after the date of the last loss, running through the end of the original coverage period. Customarily, the reinstatement cover provides only a single limit and is not likely to include a reinstatement provision. For example, after the major windstorms of 2004 and 2005, ceding companies that sustained losses reinsured under their reinsurance contracts may have lacked sufficient reinsurance protection for the remainder of the year. In such an instance, those insurers might attempt to secure reinsurance to replace that no longer available under the original contracts.

Reinstatement of data

Computer insurance indemnifying the insured in respect of the cost of reinstating data contained in the data-carrying material following accidental erasure, accidental failure of the public electricity supply when exceeding 30 minutes, and the insured being denied access to the premises or use of the computer because of loss/damage to other property in the vicinity. Other losses can be added to the cover.

Reinstatement Premium

REINSURANCE: A pro-rate reinsurance premium is charged for the reinstatement of the amount of reinsurance coverage that was reduced as the result of a reinsurance loss payment under a catastrophe cover.
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An additional premium paid to replenish (reinstate) the limit consumed in the event of a loss.
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REINSURANCE: An additional reinsurance premium that may be charged for reinstating the amount of reinsurance coverage reduced as the result of a reinsurance loss payment under a reinsurance contract, typically a “Cat” or “Clash” cover/program. See Reinstatement Clause.
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Premium to reinstate the sums insured which has been eroded by claim payments.

Reinstatement Value Clause under Standard Fire and Special Perils Policy

In the event of the property specified being destroyed or damaged the basis upon which the amount payable is to be calculated shall be cost of replacing or reinstating on the same site or any other site with the property of the same kind or type but not superior to or more extensive the insured property when new as on date of the loss subject to (i) work of replacement must be completed within 12 months or within such further time not exceeding 12 months if agreed by insurers (ii) Until expenditure has been incurred by the insured in replacing or reinstating the property the company shall not be liable for any payment in excess of the amount which would have been payable if this clause was not incorporated in the policy. (iii) Subject to average as specified (iv) This clause is not applicable if the insured fails to intimate to the insurer within 6 months from the date of destruction or damage or such further time as insurer may in writing allow his intention to replace of reinstate the property destroyed or the insured is unable or unwilling to replace of reinstate the property destroyed or damaged.