Retrocession is the reinsuring of a risk by a reinsurer.
A retrocession is placed to afford additional capacity to the original reinsurer, or to containor reduce the original reinsurer's risk of loss.
Reinsurance companies cede risks under retrocession agreements to other reinsurers, for reasons similar to those that cause primary insurersto purchase reinsurance.
Retrocession is the reinsuring of a risk by a reinsurer.