After a certain period of time, the company may have the right (from its point of view) or the obligation (perhaps from the worker`s point of view) to acquire the shares of the disabled worker. If disability is a triggering event, it is important to have a clear definition of what “disability” means. When the company manages disability insurance for key owners, a simple definition of disability for buy-and-sell contracts is that of the insurance company. If the carrier considers a shareholder to be disabled and begins making disability payments under the policy, the disability clause in a sales contract could take effect on the day of the first payment. The term “trigger” may have a benign connotation. If A occurs, B is triggered or set in motion. However, most trigger events related to sales contracts are less benevolent. Consider the acronym “QFRDDD” to list the main trigger events for purchase sales contracts: Disaster reinsurance operations can include up to three reintroductions. This means that once a transaction has been initiated and a total loss has been incurred during the defined risk period, the reinsurer will reimburse the premium and receive reinsurance coverage in exchange for the remainder of the risk period. This gives the ceding a protection against a high frequency of serious events. As a general rule, these structures are not used in guaranteed reinsurance, as recovery commitments should also be guaranteed, although the re-engagement premium can never be paid, making the transaction very effective in terms of capital.
Insurance companies will include triggers, known as “coverage triggers,” in policies they have covered. In the case of coverage of property or accidental damage, the nature of the event that must take place for the protection of liability to be an application. Insurers take advantage of a triggering event to limit their risk of risk. In some universal life insurance, withdrawals from service of the liquid portion of the policy may be permitted in the contract. These withdrawals allow distributions with impunity before an age-related trigger event. A transaction exposed to multiple events during the defined risk period (for example. B, all natural hazards in Australia, resulting in an aggregate industrial loss of $10 billion).