Finance

All of the following statements about business objectives in designing

All of the following statements about business objectives in designing a rating system are true EXCEPT A) The rating system should encourage loss control activities. B) The rating system should be independent of long-run changes in economic conditions. C) The rating system should be simple to understand. D) The rating system should be stable over […]

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Date: September 19th, 2020

Sue double-majored in mathematics and statistics in college. She also

Sue double-majored in mathematics and statistics in college. She also enrolled in a number of finance courses. After graduation, she was hired by Econodeath Insurance Company. Her job is to calculate premium rates for life insurance coverages. Sue is a(n) A) actuary. B) underwriter. C) claims adjustor. D) producer.     ANSWER Answer: A

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Date: September 19th, 2020

Which of the following statements about methods for estimating loss re

Which of the following statements about methods for estimating loss reserves for property and casualty insurers is (are) true? I. The judgment method involves the use of a statutory formula to estimate the loss reserve. II. The average value method is used when the number of claims is large and the claims are settled quickly. […]

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Date: September 19th, 2020

Pac-Coast Insurance (PCI) concentrates its underwriting activities in

Pac-Coast Insurance (PCI) concentrates its underwriting activities in California. The company is concerned that if a catastrophic earthquake occurs, it might threaten the solvency of the company. To address this risk, PCI issued some debt securities. If a catastrophic earthquake occurs, PCI does not have to repay the full amount borrowed or pay interest. The […]

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Date: September 19th, 2020