A quota share is a specified number or percentage of the allotment as a whole (quota), that is prescribed to each individual entity.
For example, the United States imposes an import quota on cars from Japan. The Japanese government may see fit to impose a quota share program to determine the amount of cars each Japanese car manufacturer may export to the United States. Any extra amount that a manufacturer wishes to export must be negotiated with another manufacturer that did not or cannot maximize its share of the quota.
Also there are quota share insurance programs. Where the benefit and the premiums are divided proportionally among the insured. For example, three companies take out a $1,000,000 fire insurance policy on a quota share basis with company A assuming 50% ($500,000), company B 30% ($300,000), and company C 20% ($200,000). If the annual premium was $5,000, company A would receive $2,500 in premium, B would receive $1,500, and C would receive $1,000.
Other articles related to "share, quota share":
... Under proportional reinsurance, one or more reinsurers take a stated percentage share of each policy that an insurer produces ("writes") ... The arrangement may be "quota share" or "surplus reinsurance" (also known as surplus of line or variable quota share treaty) or a combination of the two ... Under a quota share arrangement, a fixed percentage (say 75%) of each insurance policy is reinsured ...
Famous quotes containing the words share and/or quota:
“How difficult the task to quench the fire and the pride of private ambition, and to sacrifice ourselves and all our hopes and expectations to the public weal! How few have souls capable of so noble an undertaking! How often are the laurels worn by those who have had no share in earning them! But there is a future recompense of reward, to which the upright man looks, and which he will most assuredly obtain, provided he perseveres unto the end.”
—Abigail Adams (17441818)
“Some are petitioning the State to dissolve the Union, to disregard the requisitions of the President. Why do they not dissolve it themselves,the union between themselves and the State,and refuse to pay their quota into its treasury? Do not they stand in the same relation to the State that the State does to the Union? And have not the same reasons prevented the State from resisting the Union which have prevented them from resisting the State?”
—Henry David Thoreau (18171862)