Question
Which of the following statements about a Ceding
Company in insurance is true?Solution
Explanation: A Ceding company is an insurance company that transfers part or all of the risk it has assumed to another insurance company called the Reinsurer. In return for transferring the risk, the Ceding company receives a commission from the Reinsurer, which compensates the Ceding company for getting the business and sharing the premium amount received to cover the risk.
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