GLOSSARY
This Insurance Glossary of Terms is produced and maintained by the National Alliance Research Academy. 
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Retention

1) Internal funds used to pay losses; 2) budgeted losses plus the “tolerance corridor.” See Tolerance corridor; 3) assumption of risk of loss as through the use of non-insurance, self- insurance, or deductibles. This retention can be intentional (active retention) or, when exposures are not identified, unintentional (passive retention). 4) In reinsurance, the net amount of risk the ceding company or the reinsurer keeps for its own account or that of specified others; it may be expressed as a percentage, a specific dollar amount, or a combination of both.

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