BASIC INFORMATION REQUIRED FOR THE ASSESSMENT OF TREATY PROPOSALS
1. Ceding Company:
- Most recent annual report of ceding company
- Full name and address
- History of company
- Information on products
- Market share
- Number of employees
- Possible rating by Standard & Poor’s, AM Best, Moody’s, and/or Fitch
- Any brochures available
- Type of contract (Quota Share, Excess of Loss, Surplus, etc.)
- Limits per risk and per bond (basic and special limits)
- Retention (gross and net e.g. retention covered by X/L)
- Other conditions e.g. commission, profit commission, management expenses, etc.
- Treaty wording including a description of anyone risk, etc.
- Statistics of previous years showing premium income and losses (paid and outstanding)
- Name(s) of leading re-insurer(s) and other re-insurers that take part in this contract or to whom this contract has been offered
- Most recent premium volume, preferably broken down per type of business
- Description of present portfolio e.g.;
- for a bond treaty; a breakdown in performance bonds, maintenance bonds, etc.
- for a credit treaty; a breakdown in sectors e.g. food & drink, tobacco, textiles, etc.
- A full description of the type of risks to be covered plus an indication of the average and/or maximum duration of the risks
- A breakdown of the number of risks according to assured amount e.g.
||NUMBER OF CLIENTS
||For credit treaty number of buyers
|0 – 100.000
|100.001 – 200.000
|200.001 – 500.000
4. Details about Underwriter(s):
- Number of underwriters employed by ceding company
- A description of the experience of the underwriter(s) plus, if possible, information about results from his/her previous positions
5. Underwriting Guidelines:
- Premium rates (if possible per type of bond)
- What are the target markets/sectors?
- What are the markets / sectors to be avoided?
- Are clients visited by underwriters?
- Financial analysis of risks: how does ceding company assess such an analysis?
- What are minimum requirements e.g. solvency, equity, etc.
- Definition “any one risk”
- Underwriting procedures (e.g. credit committee)
- Regarding credit insurance: Percentage of coverage/ Use-factors/ Waiting periods
- Policy of ceding company regarding counter guarantees/collateral (what kind)?
- are these signed by risk company and/or mother company of risk company?
6. Projections of coming years:
- Expected premium volume for next 3 years in numbers
- Market share & strategy
- Growth expectations (in what area, which sectors, etc.)