There is lots of terminology within the reinsurance market, so let's have a look at some of the key terms.

Firstly, we've got the precedent, which is the name given to the insurance company, purchasing reinsurance to transfer risk.

They can also be known as the seeding party.

Next, we've got the reinsurer, which is the company issuing the reinsurance policy and assuming the risks specified in the contract.

The term retention relates to the amount of risk the decedent keeps, which has not been seeded to the reinsurer.

This is typically expressed as either a specific monetary amount or a percentage of the total claim amount.

And finally, session, which is the portion of risk transfer to the reinsurer, which applies to both premiums and potential losses.