S
SteveD
Member
Indexed limits/retention on XoL contracts:
How does it work with part payments in practice? For example, if a claim was incurred in mid 2004, and there was a risk XL contract in-force with a retention of £4m, and the claim was settled by making 2 payments of £4m each (one in June 2005 and one in June 2006), and inflation was running at 5% pa, how much is recoverable when a stability clause is in place?
Also, regarding financial reinsurance, I'm struggling to tell the difference between run-off solutions and loss portfolio transfers - can anyone explain how they differ?
And finally.. a question about the SA3 notes on credit securitisation and ILS:
Under the credit securitisation heading, the non-core reading section looks to me like it's roughly describing CAT bonds (ie it speaks of placing capital in an SPV etc). However, CAT bonds are then also mentioned in the ILS section. Does this mean that ILS and Securitisation are essentially different names for the same types of contract? I was once under the impression that one made banking products look like insurance contracts and the other did the opposite? Is this not true? Help!
Many thanks.
Steve
How does it work with part payments in practice? For example, if a claim was incurred in mid 2004, and there was a risk XL contract in-force with a retention of £4m, and the claim was settled by making 2 payments of £4m each (one in June 2005 and one in June 2006), and inflation was running at 5% pa, how much is recoverable when a stability clause is in place?
Also, regarding financial reinsurance, I'm struggling to tell the difference between run-off solutions and loss portfolio transfers - can anyone explain how they differ?
And finally.. a question about the SA3 notes on credit securitisation and ILS:
Under the credit securitisation heading, the non-core reading section looks to me like it's roughly describing CAT bonds (ie it speaks of placing capital in an SPV etc). However, CAT bonds are then also mentioned in the ILS section. Does this mean that ILS and Securitisation are essentially different names for the same types of contract? I was once under the impression that one made banking products look like insurance contracts and the other did the opposite? Is this not true? Help!
Many thanks.
Steve