Question

What is the purpose of reinsurance?

a.

To reduce the perils that an insurance company has accepted

b.

To reduce the amount of premiums an insurer needs to collect

c.

To increase the likelihood of losses for an insurer

d.

To provide financial support to the reinsurer

Posted under IC85 Reinsurance Management

Answer: (a).To reduce the perils that an insurance company has accepted Explanation:Reinsurance is a means by which an insurer reduces the perils that it has accepted.

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