What does Contingency Reserve mean? Read on to discover the definition & meaning of the term Contingency Reserve - to help you better understand the language used in insurance policies.
A contingency reserve, in the context of insurance, is the amount of money insurers set aside above the legal requirements to cover unexpected or unforeseen losses. It may be used to pay out claims or other underwriting expenses in the event that the money brought in from premiums and the loss reserves are not enough to cover costs.
We hope the you have a better understanding of the meaning of Contingency Reserve.