Is it true that pricing a reinsurance contact is equivalent to pricing an option. Basically a reinsurance just cuts off the risk exposure of the insured institution to a threshold say $K$. So if we assume that the prospective losses of the risky portfolio of the institution can be modelled by a random variable X, then the price of the insurance should just be the expected value of $(X-K)^+$, right? This however can be viewed as a call option so we can apply the same pricing methods. Is there any literature on that with further examples of this kind?
You are correct on how you should price reinsurance $E[(X-K)^+]$ and you can view reinsurance as a call option. To this extent, you could price reinsurance with Black-Scholes. However, Black-Scholes is usually used for shorter durations and reinsurance contracts (depending on the product) are typically longer than the 3-6 month horizon used on options. I believe PartnerRe put out a white paper on this (for life reinsurance).