{
  "id": "clause-loss-corridor",
  "type": "clause",
  "languages": {
    "en": {
      "id": "clause-loss-corridor",
      "lang": "en",
      "type": "clause",
      "title": "Loss Corridor Clause",
      "shortDefinition": "The loss corridor clause sets a band of loss ratios within which the cedent bears losses entirely on its own account, while the reinsurer is only liable below and above the corridor.",
      "synonyms": [
        "Loss corridor"
      ],
      "linesOfBusiness": [
        "Reinsurance"
      ],
      "jurisdictions": [
        "Global"
      ],
      "tags": [
        "Reinsurance",
        "Risk sharing"
      ],
      "relations": {
        "relatedTerms": [
          "term-proportionale-rueckversicherung",
          "clause-loss-ratio-cap",
          "term-erschoepfungsklausel"
        ],
        "partOf": [],
        "appliesTo": [
          "term-proportionale-rueckversicherung"
        ],
        "regulatedBy": [],
        "relevantFor": [],
        "insurableVia": [],
        "mitigatedBy": [],
        "comprises": [],
        "alternativeTo": [],
        "complementedBy": []
      },
      "attribute": null,
      "profile": null,
      "coverageProfile": null,
      "clause": {
        "kind": "limitation",
        "origin": "reinsurance-market",
        "favours": "insurer",
        "negotiability": "negotiable",
        "standardWordings": []
      },
      "legalBasis": [],
      "standards": [],
      "reviewStatus": "expert-reviewed",
      "reviewedBy": "Guido Hesse, Hesse Group Holding AG",
      "lastReviewed": "2026-09-04",
      "version": "0.2.0",
      "updated": "2026-09-03",
      "generated": {
        "by": "cursor-agent/claude-sonnet-5",
        "at": "2026-09-03T00:00:00.000Z"
      },
      "verified": [
        {
          "by": "human:ghesse",
          "at": "2026-09-04T00:00:00.000Z",
          "method": null
        }
      ],
      "staleAfter": null,
      "url": "https://hgh.ch/lexikon/en/knowledge/clause/loss-corridor-clause/",
      "alternateUrl": "https://hgh.ch/lexikon/de/wissen/klausel/loss-corridor-klausel/",
      "body": "## Purpose\n\nA proportional treaty normally covers losses linearly according to the cession percentage. The loss corridor clause breaks that linearity: within a defined band of loss ratios – for example between 80 and 100 percent – the cedent bears the full loss itself, while reinsurance responds normally outside that corridor.\n\n## Effect and limits\n\nThe clause reduces the reinsurance premium, as the reinsurer is relieved in the middle, frequently occurring loss range. It only works if the corridor is realistically calibrated to the cedent's expected loss distribution – a poorly placed corridor can significantly burden the cedent in economically difficult years.\n\n## Negotiation and practice\n\nThe position and width of the corridor must be negotiated closely against historical loss experience and portfolio volatility. The corridor is often combined with a loss ratio cap to fully define the overall risk-sharing structure."
    },
    "de": {
      "id": "clause-loss-corridor",
      "lang": "de",
      "type": "clause",
      "title": "Loss-Corridor-Klausel",
      "shortDefinition": "Die Loss-Corridor-Klausel legt eine Schadenquotenbandbreite fest, innerhalb derer der Zedent Schäden vollständig selbst trägt, während der Rückversicherer nur unterhalb und oberhalb des Korridors haftet.",
      "synonyms": [
        "Schadenkorridor"
      ],
      "linesOfBusiness": [
        "Rückversicherung"
      ],
      "jurisdictions": [
        "Global"
      ],
      "tags": [
        "Rückversicherung",
        "Risikoteilung"
      ],
      "relations": {
        "relatedTerms": [
          "term-proportionale-rueckversicherung",
          "clause-loss-ratio-cap",
          "term-erschoepfungsklausel"
        ],
        "partOf": [],
        "appliesTo": [
          "term-proportionale-rueckversicherung"
        ],
        "regulatedBy": [],
        "relevantFor": [],
        "insurableVia": [],
        "mitigatedBy": [],
        "comprises": [],
        "alternativeTo": [],
        "complementedBy": []
      },
      "attribute": null,
      "profile": null,
      "coverageProfile": null,
      "clause": {
        "kind": "limitation",
        "origin": "reinsurance-market",
        "favours": "insurer",
        "negotiability": "negotiable",
        "standardWordings": []
      },
      "legalBasis": [],
      "standards": [],
      "reviewStatus": "expert-reviewed",
      "reviewedBy": "Guido Hesse, Hesse Group Holding AG",
      "lastReviewed": "2026-09-04",
      "version": "0.2.0",
      "updated": "2026-09-03",
      "generated": {
        "by": "cursor-agent/claude-sonnet-5",
        "at": "2026-09-03T00:00:00.000Z"
      },
      "verified": [
        {
          "by": "human:ghesse",
          "at": "2026-09-04T00:00:00.000Z",
          "method": null
        }
      ],
      "staleAfter": null,
      "url": "https://hgh.ch/lexikon/de/wissen/klausel/loss-corridor-klausel/",
      "alternateUrl": "https://hgh.ch/lexikon/en/knowledge/clause/loss-corridor-clause/",
      "body": "## Zweck\n\nEin proportionaler Vertrag deckt normalerweise die Schadenquote linear entsprechend der Zessionsquote. Die Loss-Corridor-Klausel durchbricht diese Linearität: In einer definierten Bandbreite der Schadenquote – etwa zwischen 80 und 100 Prozent – trägt der Zedent den vollen Schaden selbst, ausserhalb dieses Korridors greift die Rückversicherung wieder normal.\n\n## Wirkung und Grenzen\n\nDie Klausel senkt die Rückversicherungsprämie, da der Rückversicherer im mittleren, häufig eintretenden Schadenbereich entlastet wird. Sie funktioniert nur, wenn der Korridor realistisch auf die erwartete Schadenverteilung des Zedenten kalibriert ist – ein falsch platzierter Korridor kann den Zedenten in wirtschaftlich schwierigen Jahren erheblich zusätzlich belasten.\n\n## Verhandlung und Praxis\n\nLage und Breite des Korridors sind eng mit der historischen Schadenerfahrung und der Volatilität des Portfolios zu verhandeln. Der Korridor wird oft mit einem Loss-Ratio-Cap kombiniert, um die Gesamtstruktur der Risikoteilung vollständig zu definieren."
    }
  }
}