Applying Treaties and Certificates to Areas and LOBs

In the Reinsurance Program Manager, you can apply treaties to lines of business (LOBs) in specified geographic regions (areas). You can apply multiple LOBs to a single treaty. You do this on the treaty's Terms tab, where you can find important information about the Applies to Area and Applies to LOB options.

Note:

For Surplus Share treaties and Facultative certificates, specify the geographic areas and LOBs in the CSV file that contains the exposure data, not in the Reinsurance Program Manager. Therefore, the Applies to Area column is always dimmed for Surplus Share treaties. (You do not manage Facultative certificates in the Reinsurance Program Manager.)

The following table summarizes the supported Applies to options by treaty and target type.


Treaty Type	Target Type	Applies to Area	Applies to Event	Applies to LOB
Catastrophe Excess of Loss	Portfolio	Yes	No	Yes
Quota Share	Contract	No	No	Yes
Quota Share	Location or Layer	See following note.	No	Yes
Surplus Share	Location or Layer	No	No	No
Per-Risk Excess of Loss	Contract	No	No	Yes
Per-Risk Excess of Loss	Location or Layer	See following note.	No	Yes

Note:

Touchstone implements the Applies to Area function for Quota Share and Per-Risk Excess of Loss treaties only when there are no layers in the exposure data. Therefore, when the target type for QS and XOL treaties is "Location or Layer" and there are no layers in the exposure data, the system applies the treaty by location and uses the Applies to Area value to filter the exposure data. When the target type is "Location or Layer" and there are layers in the exposure data, the system applies the treaty by layer and does not use the Applies to Area value to filter the exposure data; the system then applies the treaty terms to all layers because it is not possible to separate layer losses by location before application of treaty terms. For similar reasons, the Applies to Area function for QS & XOL treaties is grayed out (not available when the target type is "Contract").

If you open a reinsurance program by clicking Reinsurance in the configuration pane—instead of by clicking Reinsurance in the navigation pane, you can select one or more LOBs from the Applies to LOB list. This is because Touchstone populates the list with any LOBs in the exposure data.

When configuring the Applies to LOB field when accessing reinsurance programs via the Detailed Loss Analysis options screen, Touchstone will validate the LOBs present in the Exposure Views selected for analysis. Any LOBs that do not appear within the selected Exposure View(s) will not appear in the user interface. In contrast, if the LOBs within the “Applies to LOB” field do match the LOBs within the Exposure View(s), the LOBs will show within the Applies to LOB field when viewing the Reinsurance Program accessed via the Detailed Loss Analysis options screen.

Procedure

To apply a treaty to one or more LOBs by geographic regions:

Open the Reinsurance Program Manager.
Open the program that contains the treaty that you want to apply to LOBs by geographic region.
In the Target Exposure list, select one or more exposure views to associate with the currently selected program.
For each treaty that you want to apply, select the Terms tab for the treaty.

If the treaty is a Quota Share treaty, make sure that you select Location or Layer as the target type.
Scroll to the Applies to Area column and click the down arrow.

A filter widget appears where you can specify the level of regional detail.

Select Area Code IsContainedIn CA. After you click Close in the widget, the Filters Applied status appears in the field. To view the current filters, click the down arrow.
Scroll to the Applies to LOB column:
- Enter each LOB, separated by commas.
- If you selected exposure views in the Target Exposure list, click the down arrow and select the LOBs.
If you do not want to apply reinsurance to your exposure data, enter None or another non-existent value. If you leave this field blank, Touchstone will apply reinsurance to your exposure data.
Click Save.
Repeat for other treaties that you want to apply to areas and LOBs.