Question

How does the range of insurance business covered affect the rate?

a.

It decreases the rate

b.

It increases the rate

c.

It does not affect the rate

d.

It depends on the exclusions

Posted under IC85 Reinsurance Management

Answer: (b).It increases the rate Explanation:The range of insurance business covered affects the rate. Where a treaty covers a number of classes of business or where there is only little exclusion the risk assumed by the reinsurer would be greater.

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