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FINITE QUOTA SHARE Definition & Legal Meaning

Law dictionary entry - legal definition of embargo

Definition & Citations:

A FINITE REINSURANCE agreement where the REINSURER agrees to pay, on behalf of the CEDING INSURER, a fixed or variable proportion of CLAIMS and expenses as they occur; ceding commissions and investment income from reserves typically cover actual claims, but if they prove insufficient the reinsurer funds the shortfall and recovers the difference from the insurer over the life of the contract.

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