18 Feb 2015

A report provided by a reinsured company (or a cedent) detailing the losses or premiums affected by reinsurance. The contents of the bordereau report depend on whether it is outlining losses or premiums. A bordereau report is periodically provided by the reinsured party, but is less commonly provided than a summary report.

While an insurance company may use reinsurers to reduce its risk exposure in exchange for a portion of its premiums, it is the party most likely to know what is going on with individual insurance contracts and their associated risks. For this reason the insurance company occasionally provides detailed information on the different risks that the reinsurer has taken on, and it does this through the bordereau.

A premium bordereau lists all of the items protected under the reinsurance contract, including the contact information of the insured, the amount of risk, the time period of reinsurance coverage, and critical dates associated with the primary insurance. A loss bordereau provides details on any losses and claims made, and what amount the reinsurance has paid out during this time period.

Providing this documentation is often a requirement laid out in the reinsurance treaty. The format of the report depends on the needs of the reinsurer and of the reinsured. The report has traditionally been provided in paper format, but the increasing popularity of computer software programs and the digitization of information have shifted the delivery of bordereaux to electronic formats.

The reinsurer uses the information found in the premium bordereaux to determine the amount of premiums that will be ceded, which allows it to book this revenue. The reinsurer can then audit this information to determine which types of risks are the most profitable to reinsure. In some cases, the amount of detail found in a bordereau is too detailed. In these cases, the reinsured party will provide a summary of the positions in aggregate format rather than details on each and every risk.

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