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extracontractual obligations (ECO)

Extracontractual obligations (ECO) are the obligations or requirements under a policy that the insurer pay certain losses or expenses not arising from the insuring agreement but from externally imposed obligations—for example, fines from a court or regulatory body.

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extracontractual obligations (ECO)

Extracontractual obligations (ECO) are the obligations or requirements under a policy that the insurer pay certain losses or expenses not arising from the insuring agreement but from externally imposed obligations—for example, fines from a court or regulatory body.

Additional Information


If ECOs are covered under a reinsurance agreement, the reinsurer pays punitive damages imposed on the insurer.