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Question 1 of 10
1. Question
During reinsurance, the wider the spread of risk the insurer has,
Correct
There are circumstances where a company desires to spread the risks it accepts from individuals beyond it covers by itself.
Incorrect
There are circumstances where a company desires to spread the risks it accepts from individuals beyond it covers by itself.
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Question 2 of 10
2. Question
An insurer must allocate capital to support the policy risks it writes, but
Correct
An insurer thus reduces its capital needs on its balance sheet by removing risks through reinsurance.
Incorrect
An insurer thus reduces its capital needs on its balance sheet by removing risks through reinsurance.
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Question 3 of 10
3. Question
An insurer can increase its capacity to write risks that are either too large or,
Correct
Both too large and too risky to write on their own go hand in hand.
Incorrect
Both too large and too risky to write on their own go hand in hand.
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Question 4 of 10
4. Question
Reinsurance can protect against vital fluctuations in an insurer’s underwriting results that can,
Correct
It’s also known as catastrophic protection.
Incorrect
It’s also known as catastrophic protection.
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Question 5 of 10
5. Question
Reinsurance can protect against fluctuations in an insurer’s underwriting that can
Correct
This is to stabilize the loss experiences.
Incorrect
This is to stabilize the loss experiences.
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Question 6 of 10
6. Question
A reinsurer normally has a greater experience with such things as pricing higher limits policies and
Correct
Technical expertise is a must with that responsibility.
Incorrect
Technical expertise is a must with that responsibility.
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Question 7 of 10
7. Question
A primary insurer can use reinsurance if it wants to withdraw from a market or a particular line of business by
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This procedure is also known as withdrawal.
Incorrect
This procedure is also known as withdrawal.
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Question 8 of 10
8. Question
Treaty reinsurance arrangements are contracts under which
Correct
Facultative reinsurance arrangements are typically used to cover large, complex individual commercial risks.
Incorrect
Facultative reinsurance arrangements are typically used to cover large, complex individual commercial risks.
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Question 9 of 10
9. Question
One way that the reinsurer shares in the risk of the primary insurer is proportional reinsurance which is a contract in which
Correct
This share is defined as a quota share.
Incorrect
This share is defined as a quota share.
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Question 10 of 10
10. Question
Excess of loss reinsurance is a method in which
Correct
Such contract indemnifies the primary insurer for losses that exceed some specified amount.
Incorrect
Such contract indemnifies the primary insurer for losses that exceed some specified amount.