Home > Glossary

Extracontractual Obligations

Extracontractual Obligations (ECO)


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

Related Products

User ID: Subscriber Status:Free