Property and Casualty Insurance - quiz 19 - Amrit Karki
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Question 1 of 10
1. Question
Loss development needs to be considered when
Correct
When determining increased limits factors using historical data, loss development needs to be considered.
Incorrect
When determining increased limits factors using historical data, loss development needs to be considered.
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Question 2 of 10
2. Question
Actuaries often use only data from claims that have been
Correct
As a result, the full amount of each claim is known and no further development will occur.
Incorrect
As a result, the full amount of each claim is known and no further development will occur.
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Question 3 of 10
3. Question
It is generally assumed that inflation for each claim is?
Correct
It is generally assumed that inflation is the same for each claim
Incorrect
It is generally assumed that inflation is the same for each claim
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Question 4 of 10
4. Question
The effect of inflation tends to be?
Correct
The effect of inflation tends to be greater than full inflation in the excess limit for two reasons.
First, some claims may not have penetrated the excess layer before inflation but do penetrate the excess layer as a result of inflation, such as the claim. Second. the entire amount of the increase is in the excess layer for those claims that were higher than the excess limit prior to inflation, such as claimIncorrect
The effect of inflation tends to be greater than full inflation in the excess limit for two reasons.
First, some claims may not have penetrated the excess layer before inflation but do penetrate the excess layer as a result of inflation, such as the claim. Second. the entire amount of the increase is in the excess layer for those claims that were higher than the excess limit prior to inflation, such as claim -
Question 5 of 10
5. Question
The profit and contingencies provision is intended to
Correct
An additional provision, or risk load, is often considered in increased limits pricing for the added risk associated with the additional uncertainty in estimating expected losses for higher limits.
Incorrect
An additional provision, or risk load, is often considered in increased limits pricing for the added risk associated with the additional uncertainty in estimating expected losses for higher limits.
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Question 6 of 10
6. Question
The expenses loaded into premium calculations should be divided into?
Correct
The expenses loaded into premium calculations should be divided into fixed and variable
Incorrect
The expenses loaded into premium calculations should be divided into fixed and variable
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Question 7 of 10
7. Question
The loss elimination NIUJ (LER) is defined to be?
Correct
LER is the difference between the expected losses at the base level deductible and the expected losses at the deductible, divided by the expected losses at the base level deductible.
Incorrect
LER is the difference between the expected losses at the base level deductible and the expected losses at the deductible, divided by the expected losses at the base level deductible.
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Question 8 of 10
8. Question
The insurer will often not be aware of every claim if the loss is less than the?
Correct
An insured may not report a claim that is for an amount clearly less than the deductible
Incorrect
An insured may not report a claim that is for an amount clearly less than the deductible
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Question 9 of 10
9. Question
In the case of the credibility factor the more data we have.
Correct
The more data we have the more we tend to believe what the data indicate.
Incorrect
The more data we have the more we tend to believe what the data indicate.
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Question 10 of 10
10. Question
A basic principle of actuarial science is?
Correct
A basic principle of actuarial science is that one must explicitly account for the time value of money.
Incorrect
A basic principle of actuarial science is that one must explicitly account for the time value of money.