FACULTATIVE CONSIDERATIONS Clause Samples
The "Facultative Considerations" clause defines the terms under which individual risks or policies may be submitted to an insurer for separate acceptance, rather than being automatically included under a broader agreement. In practice, this clause allows the insurer to review and decide on each risk on a case-by-case basis, often requiring additional information or negotiation for coverage, premium, and terms. Its core function is to provide flexibility for both parties, enabling tailored risk assessment and acceptance, and addressing situations where standard coverage terms may not be suitable.
FACULTATIVE CONSIDERATIONS. The Reinsurer’s approval to exchange or replace the Original Policy will be required if the Original Policy was reinsured on a Facultative basis, and the New Policy is fully underwritten by the Ceding Company.