Question

Why it is the dangerous to accept too much business of a particular class in a particular territory?

a.

It can cause imbalance to the reinsurer's business

b.

It can expose the reinsurer to heavy losses

c.

Both a and b

d.

None of the above

Posted under IC85 Reinsurance Management

Answer: (c).Both a and b Explanation:Accepting too much business of a particular class in a particular territory can cause an imbalance to the reinsurer's business and expose them to heavy losses.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. Why it is the dangerous to accept too much business of a particular class in a particular territory?
Add Comment

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What is the significance of following a leader in treaty negotiations?

View solution

Q. What is reciprocity in the context of treaty reinsurers?

View solution

Q. What should reinsurers ensure regarding the ceding insurer's retention?

View solution

Q. What is the reason behind progressively reducing commission terms for cessions at higher level surpluses?

View solution

Q. What is the reason behind progressively reducing commission terms for cessions at higher level surpluses?Why do reinsurers prefer securing a waiver of reserves in treaties?

View solution

Q. What is the benchmark for assessing a country's financial ability to honor transactions?

View solution

Q. What does a Standard & Poor rating of BBB indicate for a country and its businesses?

View solution

Q. Why is exchange rate fluctuation considered a major consideration in reinsurance transactions?

View solution

Q. What should be considered when assessing the tax system for reinsurance transactions in various countries?

View solution

Q. What is the primary purpose of a surplus treaty in reinsurance?

View solution

Q. When is a quota share treaty typically used?

View solution

Q. What is the characteristic of a variable quota share treaty?

View solution

Q. What is the purpose of placing business facultatively in reinsurance?

View solution

Q. How does a Risk Excess cover operate?

View solution

Q. What is the purpose of a facultative obligatory treaty?

View solution

Q. Which type of treaty provides reinsurance protection on a layered basis?

View solution

Q. How are the lower layers of an excess of loss treaty rated?

View solution

Q. What does a stop loss ratio reinsurance arrangement aim to protect?

View solution

Q. Why do ceding insurers value reciprocal reinsurance trading?

View solution

Q. What are the benefits derived from a reciprocal exchange of treaties?

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...

Genetic Engineering

Unlock the potential of Genetic Engineering with our dedicated category. Explore gene...

Civil Engineering

Dive into the world of Civil Engineering with our specialized category. Explore the...

Marketing and Marketing Management

Uncover the strategies and tactics of marketing with our Marketing and Marketing...

Electrical Measurement and Instrumentation

Unlock the world of electrical measurements with our dedicated category. Explore...

Cognitive Radio

Step into the dynamic world of Cognitive Radio, where wireless communication meets...

Sociology

Gain insights into human behavior and society with our Sociology category. Explore...

Professional Communication

Hone your communication skills with our Professional Communication category. Enhance...

Power Plant Engineering

Embark on a journey through the fascinating domain of Power Plant Engineering, where...