What is indirect coinsurance in SAP FS-PM - Policy Management?

SAP Term: indirect coinsurance

• Component: FS-PM

• Component Name: Policy Management

• Description: Participation type in coinsurance. The indirect coinsurers are not named for the policyholder they are not listed on the insurance policy, and are only liable for the policyholder via the leading coinsurers - hence the term 'indirect' no legal relationship between the indirect coinsurer and the policyholder. These insurance companies normally pay leading insurer commission to the leading insurance company.

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• Key Concepts: 
  Indirect coinsurance is a feature of the SAP FS-PM Policy Management component that allows insurers to manage their risk exposure by sharing it with other insurers. This is done by creating a reinsurance agreement between the two insurers, where one insurer agrees to take on a portion of the other insurer’s risk. The insurer taking on the risk is known as the “coinsurer”, while the insurer sharing the risk is known as the “indirect coinsurer”. 
  
  How to use it: 
  In order to use indirect coinsurance, insurers must first create a reinsurance agreement between themselves and the indirect coinsurer. This agreement should specify the terms of the arrangement, such as how much risk each party will take on and how much each party will be paid for taking on that risk. Once this agreement is in place, insurers can then use the FS-PM Policy Management component to manage their risk exposure by setting up indirect coinsurance agreements with other insurers. 
  
  Tips & Tricks: 
  When setting up an indirect coinsurance agreement, it is important to ensure that both parties are aware of their obligations and responsibilities under the agreement. Additionally, it is important to ensure that all parties are aware of any changes or updates to the agreement in order to avoid any misunderstandings or disputes. 
  
  Related Information: 
  For more information about indirect coinsurance and how to use it in SAP FS-PM Policy Management, please refer to SAP’s official documentation on the topic. Additionally, there are many online resources available that provide further information and guidance on using indirect coinsurance in SAP FS-PM Policy Management.