Question

What is "facultative shopping"?

a.

When the reinsurer automatically accepts the risk of the direct insurer

b.

When the direct insurer sends the case to more than one reinsurer and chooses the most competitive offer

c.

When the reinsurer declines the risk

d.

None of the above

Answer: (b).When the direct insurer sends the case to more than one reinsurer and chooses the most competitive offer Explanation:Facultative shopping is a term used in the facultative type of reinsurance, where the case may be sent to more than one reinsurer and the reinsurer who gives the most competitive offer is chosen by the insurance company.

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Q. What is "facultative shopping"?

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