Types of facultative reinsurance are as follows:
Pro rata is a type of facultative reinsurance where the ceding company and reinsured share premium and losses on particular risks in accordance to the agreed percentage.
Excess of loss is a type of facultative reinsurance where analysis of potential damage caused by losses is needed. The ceding company will select a level of loss compatible with net and treaty guidelines and will use such information as the retention. The facultative reinsurer provides a limit of reinsurance which exceeds the retention.
- Casualty Facultative Reinsurance
- General Liability
- Personal/Commercial Automobile
- Workers’ Compensation and/or Employer’s Liability
- Excess Liability
- Facultative Property Reinsurance
There are numerous types of property lines, which varies. Such property lines may be categorised as the following:
- Standard Lines
- Technical Risks
- Excess and Surplus Lines.