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Question 1 of 30
Which of the below can be considered national data consolidation problems?
I. It may be difficult to avoid accounting for these operations twice when in fact there is only one risk transfer.
II. Numerous groups have international reinsurance programs, an entity first accepting risks internally, then retroceding them.
III. Group consolidation problems: a subsidiary cannot be accounted for both in its country of origin and in its parent company’s books.
IV. Because of widely differing counting rules, figures cannot be readily compared and aggregated.Correct
The reinsurance market is highly integrated at the global level and essentially over-the-counter. Related economic information is therefore hard to collect and relatively rare. When it comes to national data consolidation problems all the variants proposed are considered to be true issues.
Question 2 of 30
Which of the below are considered to be true, valid reinsurance and used often?
I. Facultative reinsurance.
II. Treaty reinsurance.
III. Pro-rata reinsurance.
IV. Quota share reinsurance.Correct
The known and valid reinsurance types used all the time by people are called: facultative, treaty, pro-rata and quota share reinsurance.
Question 3 of 30
What will prudent insurers do in any given situation considering the options you are given?
I. Will avoid over-exposure in general.
II. Will try to avoid exposure at any risk.
III. Will always only take risks they have experience in.
IV. Only use facultative reinsurance to reinsure business.Correct
In any possible situation, the prudent insurers will try to avoid overexposure at any risk.
Question 4 of 30
Which of the statement from the solutions offered about prudent insurers do you consider to be true?Correct
The prudent insurers in any given situations will try to avoid over-exposure, on any risk.
Question 5 of 30
Which from the below can be considered one of the most fundamental aspects that differentiate reinsurance from the retail insurance?Correct
One of the most fundamental aspects that differentiate reinsurance from retail insurance comes from a regulatory perspective.
Question 6 of 30
Which are some of the rules the deposit accounting for a contract generally observes?
I. The accounting is done on an individual contract-by-contract basis and the resulting contract-by-contract amounts are reported on a summary basis in financial reports.
II. The amount received for a contract is recorded as a deposit liability, with no revenue or expense impact.
III. The deposit liability is increased due to additional receipts, and usually investment income credits of some sort, and decreased due to payments.
IV. The deposit generally represents a present value of future payment obligations.Correct
The rules the deposit accounting for a contract generally observes refers to a present value of future payment obligations; the deposit liability, with no revenue or expense impact. The deposit liability is most of the time increased due to additional receipts.
Question 7 of 30
Which nonforfeiture option is automatically selected by the company if not chosen by the policy owner?Correct
The nonforfeiture option that is automatically selected by the company if not chosen by the policy owner is called extended-term.
Question 8 of 30
With the reduction of premium dividend option, how is the dividend used most of the time?Correct
When the premium dividend option is reduced, the dividend is applied to the next year’s premium.
Question 9 of 30
What settlement options are available in life insurance policies?
I. Lump-sum cash.
II. Fixed period.
III. Fixed amount.
IV. Life income.Correct
The available settlement options that are part of the life insurance policies are lump-sum cash, fixed period and amount and life income.
Question 10 of 30
With the interest-only settlement option what happens to the policy’s death benefits?Correct
The interest-only settlement option are retained and only the interest is paid to the beneficiary in case of the policy’s death.
Question 11 of 30
What are some of the dividend options in life insurance policies considering the variants offered?
II. Reduced premium.
III. Accumulation of interest.
IV. Paid-up addition.Correct
Some of the dividend options that are part of the life insurance policies are cash, reduced premium, accumulation of interest and paid-up addition.
Question 12 of 30
In case of a car accident, which of the answers given do you consider it to suit the situation?Correct
In case of a car accident involving multiple participants, the event will be considered as a single event by the policyholders of the company.
Question 13 of 30
How would you consider that the notion of an event could be defined by some of the answers given?Correct
The notion of an event could be defined as an essential prerequisite in non-proportional reinsurance.
Question 14 of 30
Which of the below answer is considered to be correct regarding the excess-of-loss treaty?Correct
In the excess-of-loss treaty, nothing is payable by the reinsurers if the amount of loss falls below this selected amount.
Question 15 of 30
How could you define the annual stop-loss through some of the answers given below as a solution?Correct
The annual stop-loss is different than other types of reinsurance through the guarantee and the priority. These are not expressed in figures but in percentages of gross premiums.
Question 16 of 30
Which of the solutions given best describe taxation from your own perspective?Correct
Through taxation, we can understand that the marginal rate of taxation on profits increases with-profits.
Question 17 of 30
Which options given here about the pre-loss financing do you think are true?
I. Pre-loss financing can include a vehicle.
II. Pre-loss financing can include derivatives.
III. Pre-loss financing can include insurance.
IV. Pre-loss financing can include contingent capital.Correct
In general, pre-loss financing can include a vehicle, derivates, insurance and contingent capital.
Question 18 of 30
Which statement about the post-loss financing from below is true from your perspective?Correct
The post-loss financing refers to an amount of money already settled before in case of a loss event.This might come from cash/reserves.
Question 19 of 30
Which statement is valid regarding the loss-financing techniques from below?Correct
In the risk management process, the demand for analysis is involved. Part of the process comes to the loss-financing techniques as well.
Question 20 of 30
How would you define the risk retention also sometimes referred to as self-insurance?Correct
The risk retention which can happen both actively and passively, it is also called self-insurance which helps preserve the risk exposure.
Question 21 of 30
Which of the below do you think are true statements about risk transfer and hedging?
I. The risk transfer/hedging markets can increase the available pools.
II. The risk transfer markets cannot increase the available pools.
III. Risk transfer occurs through the insurance of the derivative markets.
IV. Risk transfer occurs through the insurance and derivative markets.Correct
The risk transfer and hedging can increase available pots but also appear through the insurance and derivates markets.
Question 22 of 30
Which of the statements noted here about the insurance pricing regarding the market cycles do you think are true?
I. As a fair premium becomes a forward-looking estimate of expected future claims (losses).
II. The cost charged to the cedant is generally referred to as the rate on line.
III. The price of coverage is often determined by dividing the rate online by the actuarial probability of loss (minus 1);
IV. Pricing cannot be unfair or egregious, and must certainly not be discriminatory.Correct
The insurance pricing regarding the market cycles includes a fair premium, a cost charged to the cedant and the price of coverage determined by dividing.
Question 23 of 30
From your own point of view which sentences mentioned here can characterize the soft market?
I. A soft market for insurance is characterized by the excess supply of risk capacity, which leads to lower premiums.
II. A soft market might develop when the system is flush with capital that needs to be allocated productively.
III. Insurers lower their underwriting standards in order to win incremental business.
IV. Insurers might lower their premiums as additional competitors enter the marketplace.Correct
In the soft market, insurers might lower their premiums or their underwriting standards in order to win incremental business. Plus, the insurance is characterized by the excess supply of risk capacity, which leads to lower premiums. It also might develop when the system is flush with capital that needs to be allocated productively.
Question 24 of 30
How is it consider the risk when a company is able to access new sources of risk capacity?Correct
When a company is able to access new sources of risk capacity it no longer faces coverage uncertainties.
Question 25 of 30
Which statement about the traditional insurance from your perspective is valid?Correct
While the banks are specialized in multiplayer, traditional insurance always provides renewable coverage of discrete lines of exposure.
Question 26 of 30
Which sentence is true about credit risk regarding any corporation in general?Correct
Companies always try to minimize their risks as much as possible, so when the risk of loss through intermediary fails to perform on its contractual obligations it involves credit risk.
Question 27 of 30
Which of the below is a true statement from the options that are given to you?Correct
A very important element of the financial markets, in general, refers to the dimension of any credit risks.
Question 28 of 30
Which of the below is the true one about the alternative risk transfer market?Correct
When clients are searching to cover both traditional and non-traditional exposures, the alternative risk transfer market is driven by demand.
Question 29 of 30
Which statement regarding the ART market regulation barriers is the correct one?Correct
The ART market always is influenced trying to overcome regulatory barriers. The scope of doing this is to try not to get limit or prohibit business in general.
Question 30 of 30
Which of the below is the true statement if you think in general about regulatory barriers?Correct
There is higher pressure on regulators. This happens because their scope is to protect individual policyholders against the prospect of insurer insolvency.