Question

What is the advantage of reinsurance for new insurance markets?

a.

Local investors often prefer more lucrative short-term activities than insurance

b.

New markets have a small volume of premium and low retention capacity

c.

New markets can make extensive use of reinsurance

d.

both b and c

Posted under IC85 Reinsurance Management

Answer: (d).both b and c Explanation:Local companies in new markets often have a smaller financial base because local investors often prefer more lucrative short-term activities than insurance. Moreover, new markets have a small volume of premium and low retention capacity, and they make extensive use of reinsurance.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. What is the advantage of reinsurance for new insurance markets?
Add Comment

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What was the main reason for the development of reinsurance in India?

View solution

Q. When was India Reinsurance Corporation formed?

View solution

Q. What is the meaning of "statutory cessions"?

View solution

Q. What is the purpose of the Reinsurance Pools in India?

View solution

Q. Which two Indian reinsurers were approved for statutory cessions?

View solution

Q. What is the main reason for the need for reinsurance in India?

View solution

Q. What was the first professional reinsurance insurer formed in India and when was it established?

View solution

Q. Which types of insurance business were required by statute to be ceded by every insurer in India in 1961?

View solution

Q. Which company became the Indian reinsurer after nationalisation?

View solution

Q. What was the aim of the market Reinsurance Programme?

View solution

Q. How did each of the four subsidiary companies handle their reinsurance cessions?

View solution

Q. What does SWIFT stand for?

View solution

Q. What was the attractive capacity offered by SWIFT on the sum insured basis?

View solution

Q. Which security rating agency gave SWIFT an "A" rating?

View solution

Q. Who is vested with the authority of regulating and controlling the conduct of insurance business in India?

View solution

Q. What is one of the key goals of regulations for reinsurance after liberalisation?

View solution

Q. Who can define their inward reinsurance underwriting philosophy after liberalisation?

View solution

Q. What was the main objective of the market Reinsurance Programme after nationalisation?

View solution

Q. What was the capacity of SWIFT on a Probable Maximum Loss (PML) basis?

View solution

Q. What is the role of IRDA in regulating reinsurance in India?

View solution
View All MCQs on IC85 Reinsurance Management

Recommended Subjects

Are you eager to expand your knowledge beyond IC85 Reinsurance Management? 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!

Environment Management

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

Financial Management and Financial Markets

Master the world of finance with our Financial Management and Financial Markets...

Engineering Geology

Explore the dynamic field of Engineering Geology with our specialized category. Delve...

Analytical Instrumentation

Dive into the world of precise measurements with our Analytical Instrumentation...

IC85 Reinsurance Management

Gear up for success in the Insurance Institute of India (III) examination with IC85...

Basic Electrical Engineering

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

Human Anatomy and Physiology

Embark on a journey through the human body with our Human Anatomy and Physiology...

Chemistry

Unlock the mysteries of chemistry with our Chemistry category. Delve into the...

Molecular Biology

Dive into the intricate world of molecular biology with our specialized category....