The collective reference to those reinsurance companies that accept business mainly from reinsurance intermediaries or brokers. See Direct Writing Reinsurer.

The facility for a Reinsurance Broker to arrange automatic Reinsurance.
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Refer: “Reinsurance, Broker’s Open Cover.”

Intermediaries who place Reinsurance business with Reinsurers on behalf of Ceding companies.

A transaction sometimes defined by statute through which, of itself or in combination with other similar agreements, an insurer assumes all or a substantial portion of the liability of the ceding company.

The ratio of the reinsurance losses incurred to the ceding company’s subject premium based upon historical experience for a proposed reinsurance agreement.

Run off basis means that the liability of the reinsurer under policies, which became effective under the treaty prior to the cancellation date of such treaty, shall continue until the expiration date of each policy; (b) Cut off basis : Cut off basis means that the liability of the reinsurance under policies which became effective under the treaty prior to the cancellation date of such treaty, shall cease with respect to losses resulting from accidents taking place on and after said cancellation date. Usually the reinsurer will return to the company the unearned premium portfolio, unless the treaty is written on an earned premium basis.

A provision found chiefly in Marine Hull reinsurance that no return of premium will be allowed except where the policy is cancelled.

REINSURANCE: (i) Largest amount of Insurance or Reinsurance available from an Insurer or group of Insurers. In a broader sense, the largest amount of Insurance or Reinsurance available in the market. (ii) Maximum amount of Insurance that a Company will write on a single risk.(iii) The percentage of surplus or the rupee amount of exposure that an insurer or reinsurer is willing to place at risk. Capacity may apply to a single risk, a program, a line of business, or an entire book of business.
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MEDICAL,USA: 1. Maximum amount of insurance an insurer or reinsurer is capable of underwriting for either one individual (single risk) or for all of its business. 2. Ability of a health care facility to provide necessary medical services.
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UK: Amount of insurance or reinsurance that can be underwritten by an entity or a market. The maximum amount of business that may be accepted by a Lloyd’s member is equivalent to his overall premium income limit. See CAPACITY BOOSTING; CAPACITY TRANSFER MARKET.
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Capacity refers to the amount of capital an insurance company or the insurance industry as a whole has to write coverage. Property and casualty insurance companies are required by state regulators to maintain certain levels of capital and policyholder surplus to underwrite risks. The combination of capital and surplus is known as capacity.When capacity declines, the cost of insurance tends to rise as insurers attempt to make up for losses. Capacity can decline due to extraordinary losses like Hurricane Katrina or reductions in investment income. Capacity can be increased through higher premiums, increased investment return, or increases in reinsurance.Thus, capacity determines the amount of insurance available. Large losses in one area (e.g., medical malpractice) can affect the capacity, and therefore availability, of that type of insurance without affecting other lines of coverage. Capacity is often seen as a test of an insurance company’s financial strength.
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The amount of premium income that insurer is permitted to write or the maximum exposure that could be accepted. It could refer to an insurance company, a reinsurance company, a Lloyd’s Name, A Lloyd’s syndicate, or a whole market. Also Refer: “Reinsurance, Capacity”
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REINSURANCE: The largest amount of insurance or reinsurance available from a company or the market in general. Also refers to the maximum amount of business (premium volume) that a company or the total market could write based on financial strength or regulatory limitations.
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US: The largest amount of insurance or reinsurance available from a company or the market in general. Capacity is determined by financial strength and is also used to refer to the additional amount of business (premium volume) that a company or the total market could write based on excess (unused) capital—that is, surplus capacity.
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The largest quantity of insurance or reinsurance available for purchase, either from one company or from the entire market.
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This term may refer to: (a) a member’s allocated capacity (b) syndicate allocated capacity (c) the total underwriting capacity of all syndicates combined; or (d) the underwriting capacity of an insurance company or reinsurance company.

(01) The working cover subject to a prospective rating plan. (02) A form of excess reinsurance wherein each year’s premium rate is determined by the amount of the ceding insurer’s excess losses for a specified number of preceding years. A form of experience rating. See Also: “Spread Loss Reinsurance.”
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Refer: “Reinsurance, Spread Loss”

It is a provision common in proportional contracts which facilitate a reinsured to make a claim and receive immediate settlement for a large loss outside of the usual periodic accounting and settlement procedure.
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See: Cash Call.