Facultative obligatory treaty

{
  "id": "MLC-T-INS-001445",
  "term": "Facultative obligatory treaty",
  "field": "Insurance and risk management",
  "definition": "A reinsurance agreement where the ceding insurer has the option, but not the obligation, to cede individual risks to the reinsurer, and if offered, the reinsurer is obligated to accept them. This structure provides flexibility for the primary insurer while guaranteeing capacity from the reinsurer. It is less common than pure facultative or pure treaty arrangements.",
  "url": "https://mlchart.com/terminology/insurance/facultative-obligatory-treaty/"
}