Final answer:
The term describing proportional reinsurance is Quota Share, where the primary insurer shares premiums and losses with the reinsurer based on a fixed percentage.
Step-by-step explanation:
The term that describes proportional (pro rata) reinsurance is B) Quota Share.
In a Quota Share reinsurance arrangement, the primary insurer and reinsurer agree to share premiums and losses based on a fixed percentage. This allows the primary insurer to underwrite policies that might be too large for them to handle alone and provides them with additional capacity. The reinsurer, in turn, receives a proportionate share of the premiums in exchange for assuming the agreed upon portion of the losses.