Topic hub

Facultative reinsurance: individual-risk placement, packs, and certificates

Facultative is optional on both sides. The operating system is the pack: slip, SOV, loss history, wording excerpts, then a certificate if someone actually writes. Speed without a complete file is just a faster wrong quote.

Facultative reinsurance is optional on both sides. The cedent or broker offers a named risk. The reinsurer looks, or does not. There is no automatic cession. Capacity, if it exists, exists because someone read a file and wrote a line. That is the legal idea. The operating system is the pack: slip, SOV, loss history, wording excerpts, then a certificate if someone actually writes.

Speed without a complete file is a faster wrong quote. This hub is individual-risk placement, packs, slips, certificates, and chase lists. The one-sentence definition is what is facultative reinsurance?. The glossary term is facultative reinsurance. Treaty — automatic capacity for a class — is a different inbox and a different hub: treaty reinsurance.

Individual-risk placement

A facultative placement is a conversation about one insured, one period, one interest, one set of limits. It may be a whole-account cover on a single risk, a layer above a retention, or a share of a primary limit. It may sit above or beside a treaty because the risk is too large, too odd, or outside the treaty class.

The work starts before anyone quotes. Someone has to assemble a file the market can price without guessing. That someone is often a broker. Sometimes it is a cedent's facultative desk. On the inbound side it is a reinsurer's assistant or underwriter. The shared object is still the pack. The brokers hub is the outbound buyer view. This page is the topic view: what the risk is, what the documents are, what "placed" actually means.

Placement fails in ordinary ways. The slip names ACME Construction Ltd. The SOV uses a trading style. The warehouse on the schedule is not on the slip. The loss run has no as-at date. The hours clause is missing. Two markets see two versions of the zip because a late email added a page and the first version was already in a syndicate inbox. None of those failures are solved by a fluent summary of the zip. They are solved by fields with spans and a chase list.

The sequence is ordinary and easy to skip.

1. Assemble the pack until an underwriter can price without guessing, or send a chase list that names what is still missing.
2. Offer the slip to markets that have appetite, with the same file version in every inbox.
3. Collect written lines on those terms, or written declines.
4. Issue or request the certificate that matches the written slip, not the covering email that moved a deductible later.
5. Stop treating the zip as placed until the certificate exists, or until the market's written line is the evidence your claims desk will accept.

Skipping step 1 is how you burn a market on an incomplete file and come back looking undisciplined. Skipping step 4 is how the claim meets a different limit than the quote.

Underwriting guidance still belongs to the reinsurer: class, occupancy, territory, construction, accumulation. Software can extract the occupancy from the slip with a span and flag that guidance has a view on warehouses. Software should not auto-bind a share because the occupancy string looked familiar. Facultative is optional. Optional means a human.

Packs

A pack is complete when an underwriter can price without guessing. If a field has no source page, it is not in the pack yet. It is on the chase list. The working contents are boring on purpose.

• Slip or MRC: named insured, period, interest, territory, limits, deductibles, conditions.
• SOV or schedule that can be summed, with slip-versus-schedule conflicts left visible.
• Loss history with an as-at date. Stale or undated runs are chase items.
• Wording excerpts that govern the risk: hours, exclusions, occupancy, construction — not a broker brochure.
• A one-page gap list. That is the work remaining.

The long guide for assembling that file is how to build a facultative submission pack. The Submission Agent is the inbound-to-pack loop from a mailbox of slips, SOVs, and loss runs. The fictional walkthrough is the sample pack inspector: ACME Construction Ltd, acme.example, property facultative.

Walk that sample as an operator, not as a demo reel. Named insured is traced to Slip.pdf page 1. Period 1 January 2026 to 31 December 2026 is traced to the same page. Occurrence limit USD 10,000,000 is traced to page 2. TIV is not traced: slip USD 42,000,000 versus SOV USD 47,100,000. Hours clause is a gap. SOV as-at date is a gap. A pack in that state is sendable only if you want the market to price a fight. Usually you chase the hours clause and the as-at, and you resolve whether the warehouse is on the slip, before you ask for a line.

That is the completeness test. Not "the zip has many files." Not "the covering email is confident." Can the underwriter open a span for every field they will put on a quote sheet, and do they have a list for the rest.

SOV versus slip is the conflict operators already know. The slip is the placing document. The SOV is the schedule of values. They should agree. They often do not, because the schedule moved after the slip was typed, or because someone rounded TIV on the slip, or because a location was added for a lender. The pack shows both spans. It does not average. It does not hide the extra warehouse. Accumulation and price both depend on whether that warehouse is in or out. Averaging it into a single TIV makes both questions unanswerable.

A pack is versioned. When the broker sends SOV v3, the pack records v3 as a document. Conflicts against the slip remain until the slip is amended or the schedule is corrected. "Use the latest SOV" without citing which file is in force is how two markets quote two TIVs.

Slips

The slip is the placing instrument. In London it may be an MRC. It states who, what, where, when, how much, on what conditions. Markets write lines on it. The slip is not the certificate. The slip is how you get to a certificate.

What is a facultative slip in reinsurance? is the definition. On this hub the ops point is narrower: every field you will later need on the certificate should already be a cited field on the slip or an explicit gap. Named insured. Period. Limit. Deductible. Share offered. Interest. Territory. If the slip says "as SOV" for TIV, the SOV must be in the pack and the TIV field is either traced to the SOV total or in conflict with a figure also printed on the slip.

Unsigned slips are not placed business. They are drafts. A pack that treats a draft slip as bound has skipped the only moment facultative is supposed to be optional. Lines written on a slip, in markets that still write lines, are commitments to those terms. If the terms later move in an email and the slip is not updated, you have a conflict between documents. Store both. Do not let the model pick the email because it is newer.

Syndication is several lines on one slip, not several packs. If following markets receive a different SOV than the leader, you have two placements pretending to be one. Keep the pack version on the slip reference. When a following market writes 5 percent of USD 10,000,000 any one occurrence, that share is a field that must match the certificate later. Mental arithmetic on written lines is how 10 percent becomes 12.5 percent in the admin system.

Electronic placing does not change the field contract. A platform submission is still a document. The limit still needs a span. The SOV is still a schedule. The chase list is still the missing pages.

Certificates

The facultative certificate is evidence of cover after someone has written. Insured, period, limits, share, conditions, reinsurer. What is a facultative certificate? is the short page. The glossary restates the split: the slip is the placing instrument; the certificate is the evidence.

Ops failures after a "yes" are mostly certificate failures. The certificate limit does not match the slip span. The named insured legal name does not match. The period shifted by a day. The share is 10 percent on the slip and 12.5 percent on the certificate because someone did mental arithmetic on a written line. The warehouse that caused the TIV conflict never made it onto the certificate schedule, or it made it onto the certificate when the slip never included it.

Those are not clerical trivia. They are the document the claims desk will be handed. Extraction on the outbound certificate is the same job as extraction on the inbound slip: fields, spans, conflicts, gaps. If you only inspect the pack at submission and never inspect the certificate, you have automated the quote and left the contract to luck.

A certificate request is also a pack. Some markets issue certificates from the slip without a second file. Some need a formal request with the written lines attached. Either way, the certificate should cite the same insured and period the slip cited, or show a conflict. Do not "clean" the name to match a policy admin system without leaving a span to the legal name on the slip.

Chase lists

A chase list is the ordered set of missing pages, stale schedules, unsigned slips, and unresolved slip-versus-SOV conflicts that block a quote. It is the work queue, not a narrative summary of the file. What is a chase list in reinsurance submissions? is the definition this site uses everywhere.

A useful chase item names three things.

• The field or document: hours clause, SOV as-at date, signed slip, loss run.
• Where it should have been: Slip.pdf, wording excerpts, the broker's last zip.
• Why it blocks: you cannot price period of indemnity, you cannot trust TIV, you cannot treat the slip as written.

Regenerate the list when a new attachment arrives. A chase list that is a static appendix in a placing presentation is decoration. A chase list that is the output of extraction — no span, therefore a gap — is the queue. The ACME sample puts hours clause and SOV as-at on that queue, and puts TIV on the conflict list rather than on the chase list. Conflicts are not gaps. They are too much evidence, not too little. You still may chase a revised slip or a revised SOV to resolve them. That chase item should say "resolve TIV conflict," not "missing TIV."

Brokers who send a complete pack with an honest chase list get faster reads than brokers who send a zip and a covering paragraph that restates the limit. Reinsurers who return a chase list instead of a vague "incomplete" get a file they can actually quote. The list is the shared language. The brokers hub is where that language meets the mailbox. The Submission Agent is the machine that should emit the list rather than a paragraph.

Facultative versus treaty in the same inbox

Facultative is a pack per risk. Treaty is a portfolio contract plus bordereaux. Both may arrive as PDFs in the same mailbox. The failure is posting a facultative occurrence limit into a treaty administration screen, or treating a surplus bordereau row as a facultative submission because it has an insured name.

Keep the hubs separate so the definitions do not drift. This page links treaty reinsurance on purpose. When a risk is thrown out of a treaty and offered facultative, that is two files: the treaty wording that excludes it, and the facultative pack that offers it. Both need spans. The chase list on the facultative pack should not be asked to explain the treaty. The treaty's own exceptions list should not be asked to place the risk.

Certificates can look like wordings. Bordereaux can look like SOVs. Operators already sort them. Software should classify with evidence — document type plus fields present — and refuse to extract a treaty attachment from a facultative slip just because both PDFs said "xs."

What this hub will not do

It will not promise a quote-time reduction. It will not publish an accuracy figure. It will not show a logo wall of markets that write construction. It will not treat a chatbot paste of a slip as a pack.

It will tell you the pack is the product, the slip is the placing instrument, the certificate is the evidence, and the chase list is the queue. Inspect the fictional ACME file on the pack inspector. Assemble the real one with the submission pack guide. If the span is missing, the field is not placed. It is chased.