What type of business do reinsurers primarily accept?

Reinsurers primarily accept business that has been originally underwritten by an insurer. This means that when insurance companies write policies for their clients, they often face significant risks. To manage these risks effectively and protect their own financial stability, insurers transfer some of the risk to reinsurers. This practice is a crucial part of the insurance industry, as it allows insurers to take on larger risks than they might handle alone, ensuring they can pay claims while maintaining solvency.

The relationship between insurers and reinsurers helps to stabilize the insurance market as a whole by spreading risk and allowing insurers to have the capacity to underwrite more policies without facing overwhelming exposure. This is essential in industries where large claims can occur, such as property, catastrophic events, and liability insurance, thus enhancing the overall resilience of the insurance sector.

The other options do not accurately reflect the primary business model of reinsurers. For instance, reinsurers do not typically accept business that insurers have declined to underwrite, which may reflect higher risk. They also do not conduct business directly with individuals who have already insured risks with an insurer but rather operate through the intermediary relationship with primary insurers. Approval from corporate clients for large insurance needs typically involves direct underwriting rather than reinsurance arrangements, which is distinct from