Question

How does market pooling work in the insurance industry?

a.

Insurers combine their net retentions and redistribute them among the group members

b.

Each insurer keeps their own net retention and cedes to the pool based on defined limits

c.

Excess of loss covers are arranged to protect the pooled business

d.

Market pooling is primarily used for life insurance products

Answer: (b).Each insurer keeps their own net retention and cedes to the pool based on defined limits Explanation:In market pools, each insurer keeps their own net retention and thereafter cedes to the pool on a priority basis up to defined limits.

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Q. How does market pooling work in the insurance industry?

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