What is Layer?
Layer is A term used to describe the way in which the risk underwritten by an insurer may be shared or off-loaded to the reinsurance market. This sharing or off-loading is done in proportional amounts in a strata or layered format, with reinsurers accepting risk at various increments of the Sum Insured or risk exposure, with each reinsurer responding consecutively. Non-proportional reinsurance programs are usually divided into various layers. The different layers are often placed with different reinsurers to facilitate placement at the best terms for the reinsured.