legal cession

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Al Jasmi argued that Wadeema was living with her father upon an order of the Shariah Court which granted him the custody following a legal cession by the mother.
Best expects SCR s pre-tax earnings to be around MAD 400 million (USD 45 million) in 2012 (MAD 581 million USD 68 million in 2011), reflecting a continuing reduction in business written, as the legal cession is progressively being phased out by 2013, and a slight deterioration in technical performance as the company increases its share of non-life business underwritten in the open market in Morocco and abroad, which should increase its earnings volatility.
Best expects the additional premium income that should be generated from this natural catastrophe reinsurance scheme to offset over the medium term the decrease in business volume due to the gradual phasing out of the legal cessions regime in Morocco.
It is the leading reinsurer in Morocco, having built its portfolio on mandatory legal cessions from Moroccan insurers.
The corporation enjoys privileged access to business through its compulsory legal cessions and its longstanding relationship to stakeholders.
Yvette Essen, report author and Director of Industry Research, Europe & Emerging Markets, added: The legal cessions in both the local and regional markets and the greater economies of scale enjoyed by the larger reinsurers limit reinsurers competitive positions and constrain their ability to increase market share.
According to the rating agency, the group will find it hard to gain significant market share in the local as well as regional markets because of the compulsory legal cessions for its bigger rivals in these markets.
ZEP-RE benefits from compulsory legal cessions, which requires cedants in some of its markets to place 10% of its business with the company before ceding risks with other reinsurers.
Additionally, AURe has exposure to Libya through its branch operation, where the company receives 10% legal cessions. Moreover, the Libyan government owns 50% of AURe and has representation on its board, which may give rise to uncertainty in AURe's prospective viability, the agency added.
Best expects the additional premium income generated from natural catastrophe reinsurance will, over the medium term, offset the decrease in business volume due to the gradual phasing out of the legal cessions regime in Morocco by 2012.
Its competitors are generally much larger players who often command legal cessions in the local market.
This is mainly from an increase on commission payable to intermediaries to attract further conventional business as the company replaces its legal cessions and assumes further risks abroad.