Question
a.
To incentivize ceding insurers to maintain balanced treatiesReserves carry a low rate of interest
b.
To allow reinsurers to build up funds to cover adverse yearsReserves create a financial burden for reinsurers
c.
To discourage ceding insurers from seeking higher level surplusesReserves reduce profitability for reinsurers
d.
None of the aboveAll of the above
Posted under IC85 Reinsurance Management
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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?
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