Contracts where an insurance company transfers a portion of its risk portfolio to another insurance company to reduce its potential exposure to significant claims. This arrangement helps insurers manage and spread risk more effectively.
Main/
Reinsurance Agreements
[]
Code
PS0016
[]
Name
Reinsurance Agreements
[]
Version
1.0
[]
Category
Insurance & Risk Management
[]
Created
2025-03-14
[]
Modified
2025-04-02
Related Techniques
• By creating complex or bogus reinsurance contracts, criminals inflate premiums and fabricate claims to route illicit proceeds through multiple entities.
• Layering is achieved as funds traverse various reinsurers—often offshore—masking the true source of the money.
• Final payouts or settlements ultimately appear as legitimate insurance or reinsurance transactions, enabling integration into the financial system.
- Criminals introduce shell reinsurers or bogus reinsurance deals to convolute the flow of funds, further distancing them from their illicit origins.
- This layering tactic involves multiple risk transfers and claim settlements, obscuring transaction trails and complicating AML investigations.