What does Retrocession mean? Read on to discover the definition & meaning of the term Retrocession - to help you better understand the language used in insurance policies.
Retrocession is when one reinsurance company has another insurance company assume some of its risks. Like many other types of insurance, this is done for a fee. Reinsurance companies commonly participate in retrocession in order to prevent the chances of being unable to meet their financial obligations in the event that a disaster occurs and causes many claims to be filed at once.
We hope the you have a better understanding of the meaning of Retrocession.