A notional account tracking a finite treaty's premiums, losses and interest, whose balance returns to the cedant.
The experience account is the central accounting mechanism of finite reinsurance: it is credited with premiums paid and agreed interest, debited with losses settled and the reinsurer's margin, and its balance determines what the cedant recovers at the treaty's end. It has no separate legal existence, but it is what makes the deal legible to both parties. The problem it solves is the return of what was not consumed: in a classical treaty a premium paid is earned by the reinsurer even if no loss occurs, and the cedant pays for a risk that did not materialize. The experience account reverses that logic and turns the premium into an interest-bearing deposit of which only the part actually consumed stays earned. It is also what makes these treaties suspect on risk transfer: the more complete the return, the less reinsurance there is, and the interest crediting rate and the reinsurer's loss cap are the two parameters a transfer analysis examines first.
A 2026 finite treaty credits 12 million euros of annual premium at 2.8 percent over five years, and debits a 4 percent annual margin. Over the period, losses settled reach 31 million. The experience account shows a closing balance of 21.7 million, returned to the cedant. The real cost of the cover to it is therefore the margin plus foregone interest, about 12.4 million over five years.
Experience account, Compte de résultat de traité, Fonds d'expérience, Experience fund