Question

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

a.

To calculate the unexpired premium for the new treaty year

b.

To withdraw liability for unexpired risks and outstanding losses from outgoing reinsurers

c.

To adjust the portfolio premium based on settlement differences

d.

To release premium reserves simultaneously with portfolio withdrawal

Answer: (b).To withdraw liability for unexpired risks and outstanding losses from outgoing reinsurers Explanation:The clean-cut method is used to withdraw liability for unexpired risks and outstanding losses from outgoing reinsurers.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

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

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What is portfolio loss withdrawal?

Q. What is portfolio loss entry?

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

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

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

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

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

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

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

Q. How are premiums calculated in reinsurance agreements?

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

Q. How is the adjustment account in reinsurance calculated?

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

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

Q. Who is responsible for paying brokerage in reinsurance placements?

Q. How are statements of accounts and balances typically sent in reinsurance placements?

Q. How is brokerage usually indicated in statements of accounts?

Q. How do brokers settle balances due to reinsurers?

Q. What is the purpose of an accounts flow chart in inward accounts management?

Q. What is the purpose of maintaining a cash loss register in inward accounts 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!