What is cession mean in insurance?

Cession is the transfer of a policy to a new owner. It means that the previous owner hands over all the policy’s rights for a specific time. While the cession is in effect, the new owner can take control of all the insurance matters for the coverage period. Cession can be voluntary or mandatory. A mandatory cession is usually required by the state in order to sell a policy.

What is a cession mean in insurance?

A cession in insurance refers to the transfer or surrender of an insurance company to a new owner or manager. Cession is especially prevalent in the life insurance industry because the company's founding families typically hold a controlling interest. In a cession, a company's assets are transferred from one owner to another. After the transfer, the new owner is responsible for all operations, policies, and liabilities.

What is the meaning of cession mean in health insurance?

Cession is a way to transfer policy ownership from one company to another. Cession is typically executed by the insured or their agent. In most cases, the insured sends a cession request to the insurance company via mail or email. If the request is accepted, the insured will transfer the policy to the new company. However, the transferring company does not automatically terminate the policy. Cession is a voluntary action that allows the insured to end their coverage with one company and transfer it to another company.

What is the meaning of cession mean in the insurance industry?

When an insurer sells an existing policy to a new customer, this is known as transfer of business. If the new owner of the policy decides to terminate the policy, they are said to cede or surrender the policy to the company. This applies to both private insurance and group insurance policies. Cession takes place when the policyholder formally gives up the insurance coverage, or the policy itself.

What is the meaning of cession mean in law?

A cession is a transfer of property from one party to another. In insurance, cession refers to the transfer of policy ownership from one insurance company to another. Cession may occur through a policy cancellation or through the endorsement of a replacement policy.