Question

What is the function of reinsurance?

a.

To provide financial support to the reinsurer

b.

To increase the likelihood of losses for an insurer

c.

To reduce the perils that an insurance company has accepted

d.

To reduce the amount of premiums an insurer needs to collect

Answer: (c).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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Q. What is the function of reinsurance?

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