Question

What is the basic principle of spread of risks?

a.

To ensure that result in any class of business is balanced

b.

To increase the insurer's ability to compete for business

c.

To achieve a wider spread of risks by writing business in many countries across many classes

d.

To limit the insurer's total aggregate commitment from all underwriting lines

Posted under IC85 Reinsurance Management

Answer: (a).To ensure that result in any class of business is balanced Explanation:The basic principle of spread of risks aims to ensure that result in any class of business is balanced and results are also balanced by geographical spread.

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