1. As a general rule, reinsurance is a contract between the direct insurer and the reinsurer to which the original assured is not a party and which does not obligate the reinsurer to the assured. (Baltica Insurance Co. V. Carr, 330). If the reinsurers fail to meet their liability, the direct insurer would still be liable for the whole loss to the policyholder. Policy holder's redress lies with the insurer and not the reinsurer. 2. Contracts of reinsurance require Utmost Good Faith on the part of the insurer. Generally, the same rules, with reference to misrepresentation and non-disclosure, that apply in connection with ordinary insurance contracts apply in cases of reinsurance contracts. Whereas an assured may not be under an obligation to describe his own bad character to his insurer, yet the insurer seeking reinsurance may be under the duty to disclose what he knows about the assured. (loonies V. Pender (1874) L. R. 90. B. 531). 3. The contract of reinsurance is equally subjected to the requirement of Insurable Interest. It is a legal financial. 4. the interest which entitles the insured or the insurer to insure or reinsure. Insurers have got insurable interest against the policy they have issued because of the possible financial involvement arising out of a loss, and this justifies the existence of insurable interest thereby validating reinsurance contracts. 5. Reinsurance is an agreement to indemnify the direct insurer, partially or altogether, against a risk assumed by him in a policy issued to a third party. (Friend Bros. V. Seaboard Surety Co. 56N, E. ALR 962). Reinsurance is a contract, which involves the principle of indemnification (Union Central Life Ins. Co. V. Lowe, 182 N.E. 611)