Life Reinsurance


In Life Reinsurance maximum possible loss is reduced by reinsured on both life insurance policy which is individual and is the facultative reinsurance or automatic reinsurance for a group of life insurance policies. This is done by ceding or giving the liability of the company in a portion or whole to another company which is the reinsurer company. In India the Insurance Regulatory and Development Authority (IRDA) has banned life insurance companies from entering into reinsurance treaty arrangements with its promoter companies or any group or associate companies without the prior approval of the regulatory authority.

Life reinsurance sector usually have larger capacities and retrocession pools behind them that allow them to take on more high-risk business. A big Life reinsurance company is ready to accept up to 100% of the risk, which can be a ‘win-win’ situation for the customer and the reinsurer, as this will enable the life insurer and reinsurer to take on business that would otherwise be lost.

Life reinsurance policies were sometimes called reassurance during the past times, but the distinction is largely a matter of history and has no significance today. But the term can be found in the names of most Life reinsurance companies, including the famous Munich American Reassurance Company.

Life reinsurance business is a where the reinsurance of life assurance business takes place. But there are some exceptions to this. The life reinsurance concept came for first time in 1995. This was introduced as part of an anti-avoidance measure. Life reinsurance is dealt in section 431B ICTA.

Life Reinsurance Products

Details regarding Life Reinsurance are given below. These categories may help you in identifying which one is the most suitable one for you.

Traditional products/ service

  • Coinsurance

  • YRT

  • Facultative underwriting

  • Mortality pricing expertise

Value added products and services

  • Product development consulting

  • Data driven knowledge (e.g., mortality/lapse)

  • Technology solutions

  • Alternative underwriting 


  • Financing Solutions

  • Capital markets intermediary

  • Surplus notes

  • Protected cell structure

New Risks

  • Product and services for seniors market

  • Longevity, riders, long term care

Life reinsurance is in a way similar to and at the same time different from reinsurance and P/C insurance. While one protects lives from monetary loss caused by premature death during economically productive years, the other one protects organizations and individuals from financial loss caused by damage of their property or by their carelessness in causing financial losses to others. Life requires the purchaser to have insurable interest in the object of insurance that is the potential to lose financially from a certain event, or else there would not be any loss. But property insurance requires insurable interest at the time when loss has occurred, while life insurance requires insurable interest only at the time a life policy is purchased, not at the death of the insured life. Thus life reinsurances are very important financial instruments in this modern era.