Question

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

a.

The size of the reinsurer and the number of clients it has

b.

The size of the direct insurer and its years of existence

c.

The number of reinsurance treaties the direct insurer has

d.

None of the above

Posted under IC22 Life Insurance Underwriting

Answer: (b).The size of the direct insurer and its years of existence Explanation:Some of the factors on which the retention limits are fixed are the size of the company and its years of existence, the quality and experience of the underwriters, the surplus of the direct insurance company, and the quality of the business sourced by the distribution channels.

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