Question

Which of the following statements is true about reinsurance?

a.

Reinsurance transfers part of the risk to another insurance company.

b.

Reinsurance is the insurance of insurance.

c.

Reinsurance cannot be done for life insurance.

d.

Both a and b

Posted under IC22 Life Insurance Underwriting

Answer: (d).Both a and b Explanation:Reinsurance is the way in which one direct insurance company transfers part of the risk to another insurance company (the reinsurer). This helps to reduce the liability of the direct insurer to a large extent.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. Which of the following statements is true about reinsurance?
Add Comment

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. Which of the following is not true about the regulations regarding reinsurers in India?

View solution

Q. Which industry did the concept of reinsurance come into being with?

View solution

Q. Which of the following is not a reinsurer for life-insurance in India?

View solution

Q. What expertise do the reinsurers have in their teams?

View solution

Q. Why might an insurer sign reinsurance arrangements or treaties with multiple reinsurers?

View solution

Q. What does the reinsurer promise to do?

View solution

Q. What is the need for reinsurance?

View solution

Q. How is the risk/liability shared between the direct insurer and the reinsurer?

View solution

Q. What is the retention limit?

View solution

Q. How do reinsurance arrangements help small upcoming insurance companies?

View solution

Q. What is retrocession?

View solution

Q. What is the purpose of reinsurance arrangements?

View solution

Q. What is the retention limit in reinsurance?

View solution

Q. Why do insurers feel the need to insure risks through reinsurers?

View solution

Q. What is a reinsurance treaty?

View solution

Q. What are some factors that are considered while fixing the retention limits?

View solution

Q. What is retrocession?

View solution

Q. What is a retrocedent?

View solution

Q. What is a retrocessionaire?

View solution

Q. Who has the primary obligation to pay a claim in an insurance contract?

View solution
View All MCQs on IC22 Life Insurance Underwriting

Recommended Subjects

Are you eager to expand your knowledge beyond IC22 Life Insurance Underwriting? We've handpicked a range of related categories that you might find intriguing.

Click on the categories below to discover a wealth of MCQs and enrich your understanding of various subjects. Happy exploring!

Business Statistics

Uncover the power of data analysis with our Business Statistics category. Explore...

Electronics and Communication Engineering

Explore the dynamic field of Electronics and Communication Engineering with our...

Railway Engineering

Embark on a journey through the world of railway systems with our Railway Engineering...

IC 89 Management Accounting

Boost your preparation for the IC 89 Management Accounting exam with our extensive...

Basic Electrical Engineering

Master the fundamentals of Electrical Engineering with our specialized category....

Biology

Dive into the realm of life sciences with our Biology category. Explore the wonders...

Environment Management

Master the art of Environment Management with our specialized category. Explore...

Environmental Biotechnology

Discover the intersection of biology and environmental science with our Environmental...

UIDAI Aadhaar Supervisor Certification

Prepare for the UIDAI Aadhaar Supervisor Certification with our specialized category....