Sec. 95. A contract of reinsurance isone by which an insurer procures athird person to insure him against lossor liability by reason of such originalinsurance.Sec. 96. Where an insurer obtainsreinsurance, except under automaticreinsurance treaties, he mustcommunicate all the representationsof the original insured, and also all theknowledge and information hepossesses, whether previously orsubsequently acquired, which arematerial to the risk.Sec. 97. A reinsurance is presumed tobe a contract of indemnity againstliability, and not merely againstdamage.Sec. 98. The original insured has nointerest in a contract of reinsurance.Reinsurance-Defined as an agreementbetween two parties called thereinsured (Ceding company) andreinsurer, respectively. Whereby thereinsurer agrees to accept a certainfixed share of the reinsured’s riskupon terms set out in the agreement. The original insurer who, havingissued a policy to an insured to covera certain risk desires to relieve itself of part therof. It cannot exist withoutoriginal insurance.
Presumed to be a contract of indemnity against liability and notmerely against damage. The perilinsured against is the risk that theinsured will suffer a loss when it will berequired to pay the original insured. The risk of damage to the propertyinsured by the insurer is not assumedby the reinsurer although the samedamage tirggers the liability of thereinsurer.
Reinsured or the ceding company orthe directwriting company and thereinsurer.No privity between the insured andthe reinsurer.But the Insured may be allowed todirectly sue the reinsurer if thereinsurance policy contains astipulation Pour autrui. The stipulationmust be clear and unmistakable.
Reinsurer is also not a party in anaction against the insurer by theinsured.
But it may have the samerecourse to the defenses of thereinsured.
The insured may alsosue the reinsurer if the insurerassigned ths the proceeds of thereinsurance policies to the originalinsured.
Insurer remains insuch capacity onlyInsurer becomesan insured in theinsurance policy There is only oneinsured There are twoseparate insured The subjectmatter is theproperty insured The subjectmatter is theproperty of the1Notes on Reinsurance: From Timoteo Aquino’s Insurance Laws
“Amat Victoria Curam”
Felipe S.R. RSIPetitor Aequi