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Solutions for Capital and Surplus Management

Whatever the reason, quota share reinsurance is a viable alternative that may allow you access to capital without increasing debt or diluting equity. Quota share reinsurance can provide not only the risk protection you need to meet the Risk-Based Capital (RBC) requirements but also simultaneously free up capital for other strategic initiatives. Unlike other financial instruments , quota share reinsurance is neither a debt instrument nor a equity instrument - it is an insurance solution that regulators recognize, understand and are comfortable with. It can also be utilized for any line of business or even a portfolio.

Case Study - Medicare

A Medicare Advantage organization was seeking investors to fund a $10m initiative. They came to Munich Re through an investment banker. After explaining the benefits of a reinsurance alternative, they decided to purchase a 50% quota share freeing up approximately 50% of their allocated capital to make operational improvements. Six months after implementing this quota share the CEO said he was surprised that more companies weren’t taking advantage of this tool to help their organizations.


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This publication is available exclusively to Munich Re clients. Please contact your Client Manager.