The global economic impact of reinsurance has increased significantly in recent years, leading to a desire for more certainty in the legal interpretation of reinsurance contracts as the number of disputes increases. Reinsurance contract wordings are not regulated by any overarching statutory law or regulations, in part due to the transnational nature of most reinsurance business. Additionally, reinsurance contracts have historically been interpreted by applying only general principles of contract law and good faith obligations with a heavy emphasis on the parties practice, usage and custom. This has led to significant uncertainty with respect to reinsurance disputes. The Principles of Reinsurance Contract Law (PRICL), published in 2019, aim to bring certainty to reinsurance contracts by improving wordings and developing widely accepted rules of interpretation.
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