12-month treaty will increase subsidiary's capacity
LitComp's after the event Insurance subsidiary, Elite Insurance Company, has signed contracts for a formal reinsurance programme with a leading international AA-rated reinsurer, the company said.
The programme is a 12-month renewable reinsurance treaty that commenced on the 1 June 2007 and which will "substantially increase Elite's capacity and reduce claims risk," Litcomp said.
Elite will be ceding income to the reinsurer but "there is an attractive profit commission scheme in the programme which will reward Elite if it achieves projected performance on claims" it added.
Aon Limited acted as reinsurance brokers for Elite.
Jason Smart, LitComp Chief Executive, commented: "It is a tremendous achievement for a company as young as Elite to have one of the world's top reinsurers as its reinsurance partner. This reinsurance programme will enable Elite to write more of the larger commercial ATE cases which are key to its business strategy and will reduce Elite's net exposure to claims. There are inherent risks in ATE insurance and we will always underwrite cautiously and take available steps to minimise risk."