What does Commutation Agreement mean? Read on to discover the definition & meaning of the term Commutation Agreement - to help you better understand the language used in insurance policies.
An agreement between a ceding insurer and the reinsurer that provides for the valuation, payment, and complete discharge of all obligations between the parties under a particular reinsurance contract. Used if an insurer is withdrawing from underwriting a class of business.
We hope the you have a better understanding of the meaning of Commutation Agreement.