How to book stop-loss reinsurance premium
Recording the premium expense for stop-loss reinsurance purchased by an MGA to protect its risk-sharing or captive program.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Ceded Reinsurance Premium Expense | Debit | 12,000.00 | - |
| Reinsurance Payable | Credit | - | 12,000.00 |
💡 Accountant's Note
MGAs with risk-bearing capacity often purchase stop-loss coverage. This entry records the obligation to pay the reinsurer for this protection.
Practitioner & Systems Framework
💻 ERP Architecture
Categorize as ceded premium to ensure it is excluded from gross written premium (GWP) metrics.
⚠️ Audit Flags
Failure to match ceded premiums with the corresponding risk periods in the underlying portfolio.
📄 Required Documentation
Reinsurance treaty summary and premium bordereau.
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Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.
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Discussion & Community Questions
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