{"id":253322,"date":"2026-08-11T13:53:36","date_gmt":"2026-08-11T17:53:36","guid":{"rendered":"https:\/\/ibkrcampus.com\/campus\/?post_type=glossary-terms&#038;p=253322"},"modified":"2026-08-18T10:33:52","modified_gmt":"2026-08-18T14:33:52","slug":"excess-of-loss-reinsurance","status":"publish","type":"glossary-terms","link":"https:\/\/www.interactivebrokers.com\/campus\/glossary-terms\/excess-of-loss-reinsurance\/","title":{"rendered":"Excess of Loss Reinsurance"},"content":{"rendered":"\n<div class=\"wp-block-buttons is-layout-flex wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button has-custom-width wp-block-button__width-50\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/ndcdyn.interactivebrokers.com\/mkt\/?src=glossGenAcc&amp;url=%2FUniversal%2FApplication\" target=\"_blank\" rel=\"noreferrer noopener\">Open Account<\/a><\/div>\n<\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Excess of loss reinsurance covers losses above a stated attachment point up to a defined limit, and is commonly arranged in stacked layers often visualized as a tower. The primary insurer retains losses below the attachment point, the first layer covers the next tranche, and higher layers cover progressively rarer and larger losses at progressively lower prices per dollar of coverage. Because each layer corresponds to a range of loss severity with its own exceedance probability, layers can in principle be priced against, or partially replaced by, other instruments that pay out in the same loss range.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><a href=\"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/ibkr-climate-energy\/hurricane-forecast-contracts-as-efficient-reinsurance\/\">Hurricane Forecast Contracts as Efficient Reinsurance<\/a><\/p>\n\n\n\n<p class=\"wp-block-paragraph\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Excess of loss reinsurance covers losses above a stated attachment point up to a defined limit, and is commonly arranged in stacked layers often visualized as a tower. The primary insurer retains losses below the attachment point, the first layer covers the next tranche, and higher layers cover progressively rarer and larger losses at progressively lower prices per dollar of coverage. Because each layer corresponds to a range of loss severity with its own exceedance probability, layers can in principle be priced against, or partially replaced by, other instruments that pay out in the same loss range.<\/p>\n","protected":false},"featured_media":0,"parent":0,"template":"","meta":{"_acf_changed":false,"footnotes":""},"traders-glossary":[13254,13251],"class_list":["post-253322","glossary-terms","type-glossary-terms","status-publish","traders-glossary-trading-terms-e","traders-glossary-trading-alphabet"],"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v26.9 (Yoast SEO v28.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Archives Term | IBKR Glossary | IBKR Campus<\/title>\n<meta name=\"description\" content=\"Excess of loss reinsurance covers losses above a stated attachment point up to a defined limit, and 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