What is YRTPR?

A Yearly Renewable Term Plan of Reinsurance is a type of proportional reinsurance in which mortality risks are ceded to a reinsurer by a primary insurer (ceding company).

A Yearly Renewable Term Plan of Reinsurance is a type of proportional reinsurance in which mortality risks are ceded to a reinsurer by a primary insurer (ceding company). In Yearly Renewable Term Plan of Reinsurance, the net amount at risk for a life insurance policy that exceeds the primary insurer’s retention limit. Under the Yearly Renewable Term Plan of Reinsurance, reinsurance premiums for the net amount at risk are renewed each year.

The primary insurer (the ceding company) yields to a reinsurer its net amount at risk for the amount greater than the retention limit on a life insurance policy in the yearly renewable term plan of reinsurance.

This plan is a reinsurance instantiation of a yearly renewable term (YRT), which is made up of one-year term policies that are renewed on an annual basis.

The ceding company will prepare a schedule of the net amount at risk for each policy year when setting up a reinsurance agreement. A life insurance policy’s net amount at risk decreases over time as the insured pays premiums, which add to the policy’s accrued cash value.