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Whole Account Quota Share

One percentage, the entire book

A quota share treaty ceding a single fixed percentage of an insurer's entire book across every line of business, rather than negotiating a separate cession class by class.

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Definition

A whole account quota share applies one fixed cession percentage across an insurer's entire portfolio — every class of business bundled together — rather than treating each line separately with its own quota share terms. It is typically used for broad capital relief across an entire company, or to support an insurer's complete start-up book when there is not yet enough individual-class experience to price separate treaties. A single blended ceding commission is negotiated for the whole account, rather than one rate per class.

One fixed percentage applies across every class bundled into the account, instead of negotiating a separate quota share for each individual line of business.
It is commonly used for company-wide capital relief or to support a new insurer's entire start-up book, not to manage the volatility of one specific class.
A single blended ceding commission covers the whole account, which can obscure very different profitability between the individual classes bundled underneath it.

Worked example

A newly licensed insurer cedes 40% of its entire book — property, casualty, and marine together — under one whole account quota share, receiving one blended ceding commission rather than negotiating three separate treaties.

Scenario · figures in USD

One blended rate hides two very different results

An insurer cedes 50% of its whole account under a single quota share with one 30% ceding commission, bundling a profitable property line with a struggling casualty line.

Property line loss ratio	55% — profitable
Casualty line loss ratio	95% — barely breaking even
Blended ceding commission across the whole account	30%, the same for both lines
What the blended rate obscures	The reinsurer is effectively overpaying commission on the casualty line and underpaying on the property line

So whatA whole account structure trades pricing precision for administrative simplicity — the blended commission can mask which classes are actually driving the account's results.

Check your understanding

What distinguishes a whole account quota share from an ordinary class-by-class quota share?

It applies one fixed cession percentage across the insurer's entire portfolio, rather than a separate treaty per class. A whole account quota share bundles every class of business under one fixed cession percentage and one blended commission, instead of pricing and structuring each line separately.

What is a key drawback of a single blended ceding commission across a whole account?

It can mask very different profitability between the individual classes bundled inside the account. Because one rate applies to every class regardless of its individual performance, a blended commission can obscure which lines are actually profitable and which are dragging on the account.

Word problem

An insurer's whole account quota share cedes 40% of a book with two lines: $6M premium in property (loss ratio 50%) and $4M premium in casualty (loss ratio 100%). If the reinsurer instead priced two separate quota shares matched to each line's own experience, which line would it prefer to reduce its share in, and why does the whole account structure prevent that?

Show a hint

Work out each line's ceded losses relative to its ceded premium, then think about what a single blended treaty forces the reinsurer to accept.

Reveal the worked answer

Ceded premium: property = 40% of $6M = $2.4M; casualty = 40% of $4M = $1.6M.
Ceded losses: property = 50% of $2.4M = $1.2M; casualty = 100% of $1.6M = $1.6M.
The casualty line returns losses equal to its full ceded premium, while the property line returns only half of its ceded premium in losses — clearly the less attractive line for the reinsurer.
A whole account structure fixes one percentage across both lines at once, so the reinsurer cannot selectively reduce its share of just the casualty line without renegotiating the entire account.

The reinsurer would prefer to reduce its share of the casualty line, since it returns $1.6M of losses against $1.6M of ceded premium versus the property line's $1.2M of losses against $2.4M of premium. But the whole account structure applies one fixed percentage to both lines together, so the reinsurer cannot adjust its participation in just the underperforming class without renegotiating the whole treaty.

Related terms

Part of the Treaty Reinsurance guide, where this term is explained alongside every other treaty metric.