Question

Re-insure means to insure again by transferring to another insurance company all or a part of a ______ assumed.

liabilities
capital
dividends
cash flows

Answer 1

Re-insure means to insure again by transferring to another insurance company all or a part of liability assumed.

• Reinsurance is an act where insurance companies buy a policy of insurance to cover themselves from the possibility of loss. The Re - insurance firms help the insurers spread their exposure to risks.
• Insurers pay a part of the premiums which they collect from their policyholders to another reinsurance company and that company agrees in return to cover the losses above certain higher limits