Pet Insurance Reinsurance Claim Reporting: Process and Requirements

Reinsurance recoveries are money owed to your program but only if you report claims correctly and on time. Late notification can void recovery rights. Inaccurate reporting creates disputes. Missing a large loss notification is a treaty compliance violation. Here's how to build reinsurance claim reporting that's accurate, timely, and treaty-compliant.

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What Is the Reinsurance Claim Reporting Framework?

The reporting framework defines what claims must be reported to reinsurers, how frequently, and who is responsible for each step. Requirements vary by treaty type, with quota share treaties requiring comprehensive quarterly bordereaux and excess of loss treaties requiring immediate large loss notifications when claims exceed retention thresholds.

1. Treaty Types and Reporting Requirements

Treaty Type	Claim Reporting	Frequency	Trigger
Quota share	All claims	Quarterly bordereau	All claims included
Excess of loss (per-risk)	Large losses only	As they occur + quarterly	Claim > retention
Aggregate excess (stop loss)	Aggregate reporting	Quarterly	Approaching attachment
Facultative	Per-risk reporting	As claims occur	Specific risk claims

2. Reporting Responsibilities

Activity	MGA Role	Carrier Role	Reinsurer Role
Claims adjudication	Primary (delegated)	Oversight	None
Data capture	Maintain accurate claims data	Verify data	Receive data
Large loss identification	Flag claims exceeding thresholds	Notify reinsurer	Acknowledge
Loss bordereau	Prepare data	Review and submit	Review and reconcile
Recovery request	Document claim	Submit request	Review and pay
Reserve reporting	Set and update reserves	Report to reinsurer	Monitor

How Does Large Loss Notification Work?

Large loss notification is the process of immediately alerting reinsurers when an individual claim exceeds specified treaty thresholds. Notification must typically occur within 24 to 72 hours of awareness, and failure to notify promptly can jeopardize recovery rights under the treaty.

1. Notification Triggers

Treaty Type	Notification Threshold	Typical Amount
Excess of loss	Claim approaches retention	e.g., >$5,000 or >$10,000
Quota share	Above carrier-specified threshold	e.g., >$10,000 individual claim
Stop loss	Aggregate approaching attachment	As losses accumulate
All treaties	Potential for significant reserve increase	Material reserve change

2. Notification Timeline

Urgency	When	Timeline
Immediate notification	Claim clearly exceeds threshold	Within 24 hours
Prompt notification	Claim likely to exceed threshold	Within 72 hours
Routine notification	Claim in excess territory, developing	Within 5 business days
Reserve update	Material reserve increase on known large loss	Within 5 business days

3. Large Loss Report Contents

Section	Information
Claim identification	Claim number, policy number, insured name
Policy details	Coverage, limits, deductible, effective date
Loss details	Date of loss, date reported, condition/diagnosis
Financial	Paid to date, current reserve, total incurred
Ceded amounts	Reinsurer's share (paid and reserved)
Narrative	Description of incident, treatment, prognosis
Expected development	Anticipated final cost, timeline
Medical documentation	Key medical records (if requested)

4. Notification Process

Step	Action	Owner	Timeline
1	Claims system flags large loss	Automated	Real-time
2	Claims manager reviews and confirms	Claims	Same day
3	Prepare large loss notification	Claims + reinsurance	Within 24–72 hours
4	Submit to carrier (or reinsurer per agreement)	Reinsurance/compliance	Per timeline
5	Acknowledge receipt	Reinsurer	1–3 business days
6	Provide updates on reserve changes	Claims	As they occur
7	Final report when claim closes	Claims	At claim closure

For reinsurance reporting processes, see our comprehensive reporting guide.

How Do You Prepare the Loss Bordereau?

The loss bordereau is a comprehensive quarterly report listing all claims with their ceded amounts, prepared within 45 days of quarter close. It requires extracting all claims data, calculating ceded amounts per treaty, reconciling with carrier reports, and formatting per reinsurer specifications.

1. Quarterly Loss Bordereau Preparation

Step	Action	Timeline
1	Extract all claims data for quarter	Day 1–5 after quarter close
2	Calculate ceded amounts per treaty	Day 5–10
3	Reconcile to carrier claims report	Day 10–15
4	Validate data quality	Day 15–20
5	Format per reinsurer specifications	Day 20–25
6	Submit to carrier/reinsurer	Day 25–45

2. Loss Bordereau Fields

Field	Description	Format
Claim number	Unique claim ID	Text
Policy number	Associated policy	Text
Date of loss	When incident occurred	YYYY-MM-DD
Date reported	When claim was filed	YYYY-MM-DD
Condition code	Diagnosis or condition type	Code
Claim status	Open, closed, denied	Code
Gross incurred	100% incurred (paid + reserve)	Currency
Gross paid	100% paid to date	Currency
Gross reserve	100% outstanding reserve	Currency
Cession %	Treaty cession percentage	%
Ceded incurred	Reinsurer's share of incurred	Currency
Ceded paid	Reinsurer's share of paid	Currency
Ceded reserve	Reinsurer's share of reserve	Currency

3. Data Quality Checks

Check	What to Verify
Completeness	Every open and closed claim included
Accuracy	Ceded amounts = gross × cession %
Reconciliation	Totals match carrier loss report
Status consistency	Claim status matches claims system
Reserve reasonableness	No stale reserves, reasonable amounts
Closed claims	Zero reserve on closed claims

How Do Reinsurance Recoveries Work?

Reinsurance recoveries follow a structured process: qualifying claims are identified, recovery amounts are calculated, requests are submitted to the reinsurer, and payment is typically received within 30 to 60 days. The MGA must track all outstanding recoveries and aging to ensure timely collection.

1. Recovery Process

Step	Action	Owner	Timeline
1	Identify claim qualifying for recovery	Claims/reinsurance	At claim payment
2	Calculate recovery amount	Reinsurance accounting	Within 5 days
3	Prepare recovery request with support	Reinsurance	Within 10 days
4	Submit to reinsurer	Carrier/MGA	Per agreement
5	Reinsurer reviews	Reinsurer	15–30 days
6	Payment received	Reinsurer → carrier	30–60 days
7	Record recovery in accounting	Finance	Upon receipt

2. Recovery Tracking

Metric	Purpose	Frequency
Outstanding recoveries	Money owed by reinsurers	Monthly
Recovery aging	How long recoveries are outstanding	Monthly
Recovery disputes	Contested recoveries	As they occur
Recovery ratio	Recovered / submitted	Quarterly
Ceded reserve accuracy	Ceded reserves match actual	Quarterly

For reinsurance basics, see our introductory guide.

What Are the Key Reserve Reporting Requirements?

Ceded reserve management requires monthly calculation of the reinsurer's share of outstanding reserves, quarterly reporting to the reinsurer, reserve development analysis, and IBNR estimation. Accuracy standards require individual claim reserves within 10% of actual outcome and aggregate reserves within 5%.

1. Ceded Reserve Management

Activity	Frequency	Purpose
Calculate ceded reserves	Monthly	Track reinsurer's share of reserves
Report reserve changes	Quarterly (or per treaty)	Keep reinsurer informed
Reserve development analysis	Quarterly	Track reserve adequacy
Reserve true-up	Annual	Adjust for development
IBNR estimation	Quarterly	Incurred but not reported claims

2. Reserve Accuracy Standards

Standard	Requirement
Individual claim reserves	Within 10% of actual outcome
Aggregate reserves	Within 5% of actual
IBNR	Actuarially determined, documented
Stale reserves	No reserves unchanged for >90 days
Closed claim reserves	Zero balance within 5 business days

What Are the Most Common Reinsurance Claim Reporting Issues?

The most common issues include late large loss notifications, inaccurate ceded amounts, missing claims in bordereaux, stale reserves, and documentation gaps. Each of these can jeopardize recoveries, create disputes, and damage the reinsurer relationship that your program depends on.

1. Reinsurance Claim Reporting Problems

Issue	Impact	Prevention
Late large loss notification	Recovery rights jeopardized	Automated flagging + alerts
Inaccurate ceded amounts	Disputes, delayed recovery	Automated calculation + validation
Missing claims in bordereau	Understated ceded losses	Completeness checks
Stale reserves	Misleading treaty performance	Quarterly reserve review
Documentation gaps	Recovery delays	Complete claim documentation

How Do You Implement Reinsurance Claim Reporting?

Implementation should follow a three-month plan: month one focuses on mapping treaty requirements and building notification triggers, month two builds bordereau extraction and validation processes, and month three tests end-to-end reporting and submits the first bordereau to the reinsurer.

1. Building Reinsurance Claim Reporting

Month 1:

• Map treaty claim reporting requirements
• Build large loss notification triggers in claims system
• Create notification templates
• Establish reporting timelines

Month 2:

• Build loss bordereau extraction and formatting
• Create validation and reconciliation checks
• Establish recovery tracking system
• Train claims team on notification requirements

Month 3:

• Test end-to-end reporting process
• Submit first bordereau to reinsurer
• Create reporting dashboard
• Document procedures and assign responsibilities

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Frequently Asked Questions

When must you report claims to reinsurers?

Quota share: all claims quarterly. Excess of loss: large losses within 24–72 hours. Stop loss: when approaching attachment point.

What information do reinsurers need?

Claim details, policy details, financial amounts (paid, reserve, incurred), ceded amounts, narrative for large losses, and medical documentation if requested.

What's the MGA's role?

Maintain accurate claims data, flag large losses promptly, prepare bordereau data, support recovery requests. Carrier manages reinsurer relationship.

What happens with recoveries?

Identify qualifying claims, calculate recovery, submit request to reinsurer, receive payment in 30–60 days. Track all outstanding recoveries.

What are the consequences of late large loss notification?

Late notification can void or reduce recovery rights, create treaty compliance violations, damage the reinsurer relationship, and lead to stricter requirements at renewal.

How should an MGA automate large loss flagging?

Configure claims system alerts at 75% and 100% of treaty thresholds, route notifications to the reinsurance team, and build escalation workflows for same-day review by the claims manager.

What is the difference between a loss bordereau and a large loss notification?

A loss bordereau is a comprehensive quarterly report of all claims with ceded amounts. A large loss notification is an immediate individual claim report triggered when a claim exceeds the treaty notification threshold.

How often should ceded reserves be reviewed?

Calculate monthly and review formally each quarter. Flag reserves unchanged for over 90 days as stale. Report material reserve changes on large losses to the reinsurer within 5 business days.

External Sources

• https://content.naic.org/
• https://www.reinsurance.org/

Internal Links

• Explore Services → https://insurnest.com/services/
• Explore Solutions → https://insurnest.com/solutions/