What is the primary purpose of a Bordereau in reinsurance?

The primary purpose of a Bordereau in reinsurance is to detail premium or loss data. A Bordereau is a report, usually prepared by the insurer or the reinsurance broker, that summarizes the premiums collected or losses incurred under specific reinsurance agreements. This detailed documentation allows reinsurers to understand the risks they are taking on and assists in the proper accounting and claims management of the reinsurance arrangement. By providing this structured data, the Bordereau also helps in ensuring transparency and accuracy in the financial dealings between the cedent (the original insurer) and the reinsurer.

The importance of this detailed listing is highlighted in reinsurance transactions where precise record-keeping of premiums and losses is crucial for evaluating the profitability and performance of the reinsurance program. Thus, focusing on premium and loss details makes the Bordereau an essential tool in the reinsurance process.