Business, Legal & Accounting Glossary
An arrangement that permits a reinsurer to make a onetime payout that fulfills any and all obligations to another party after a given time period. Exercising the commutation clause permits the reinsurance company to discharge all responsibilities under a policy and limit ongoing exposure in situations such as long-term disability where losses are ongoing or recurring.
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This glossary post was last updated: 20th November, 2021 | 0 Views.