Common use of Ceding Company Clause in Contracts

Ceding Company. An insurer which underwrites and issues an original, principal policy to an insured and contractually Cedes a portion of the Risk to the Reinsurer. Coinsurance – Indemnity life reinsurance under which the reserves as well as the Risk are transferred to the Reinsurer; the Ceding Company retains its liability to the contractual relationship with the insured. Under the Coinsurance method, the Ceding Company will pay the Reinsurer a proportionate part of the Premiums it receives. In return, the Reinsurer agrees to pay the Ceding Company a proportionate part of the claim and participate in all other policy benefits explicitly stated in this Agreement.