Question

What are the "eighth," "twelfth," and "twenty-fourth" systems used for in the calculation of portfolio premium?

a.

Calculating the reinsurance commission for the renewing reinsurer

b.

Adjusting the portfolio transfer based on alterations in the business composition

c.

Estimating the unexpired portions of each month's business at the end of the year

d.

Dividing the premiums into equal parts based on the number of reinsurers

Posted under IC85 Reinsurance Management

Answer: (c).Estimating the unexpired portions of each month's business at the end of the year Explanation:The "eighth," "twelfth," and "twenty-fourth" systems are used to calculate the unexpired portions of each month's business at the end of the year, considering the assumption that the majority of each month's premiums will usually expire in the middle of the month.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. What are the "eighth," "twelfth," and "twenty-fourth" systems used for in the calculation of portfolio premium?
Add Comment

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What is the purpose of the portfolio withdrawal calculation?

View solution

Q. How is the unexpired exposure of each month's premium calculated?

View solution

Q. Which method provides a more accurate calculation of the net portfolio premium?

View solution

Q. What is the approximate percentage of the premium ceded to the treaty that works out as portfolio withdrawal?

View solution

Q. How does the calculation for unexpired risks in financial accounting differ from the portfolio withdrawal calculation?

View solution

Q. What is the purpose of the clean-cut method in reinsurance?

View solution

Q. What is portfolio loss withdrawal?

View solution

Q. What is portfolio loss entry?

View solution

Q. When is the clean-cut method typically followed?

View solution

Q. What happens to premium reserves in the clean-cut method?

View solution

Q. What is the range of interest that ceding insurers allow reinsurers in treaties with provision for retention of reserves?

View solution

Q. When is the interest credited to reinsurers in treaties with provision for retention of reserves?

View solution

Q. How is the net return to the reinsurer affected by tax regulations?

View solution

Q. What is the nature of accounts under non-proportional treaties?

View solution

Q. What are non-proportional treaty accounts not subject to?

View solution

Q. How are premiums calculated in reinsurance agreements?

View solution

Q. How are premiums calculated in reinsurance agreements?What is the purpose of a deposit premium in reinsurance agreements?

View solution

Q. How is the adjustment account in reinsurance calculated?

View solution

Q. What is the unit of currency expressed in a treaty agreement?

View solution

Q. Under what conditions can a ceding insurer revert to accounting in original currencies?

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!

Geotechnical Engineering

Dive into the world of Geotechnical Engineering with our dedicated category. Explore...

Data Interpretation

Master the art of data analysis and interpretation with our Data Interpretation...

Total Quality Management

Enhance your understanding of quality management with our Total Quality Management...

General Knowledge

Expand your horizons and stay informed about the world with our General Knowledge...

Analytical Instrumentation

Dive into the world of precise measurements with our Analytical Instrumentation...

Biotechnology

Discover the cutting-edge world of biotechnology with our Biotechnology category....

Cognitive Radio

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

Mechanical Engineering

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

Biochemistry

Delve into the intricate world of Biochemistry with our Biochemistry category....