Question

Credit ratings for reinsurers with cross-border operations do not account for:

a.

Financial stability

b.

Market reputation

c.

Potential foreign exchange restrictions

d.

Claims settlement efficiency

Answer: (c).Potential foreign exchange restrictions Explanation:For reinsurers with cross-border or multinational operations, including subsidiaries or branch offices, the credit ratings do not take into account the potential foreign exchange restrictions that may prevent financial obligations from being met. The focus is on financial strengths and security characteristics rather than exchange restrictions.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. Credit ratings for reinsurers with cross-border operations do not account for:

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. Credit ratings are based on information provided by:

Q. Which of the following statements about credit ratings is true?

Q. The assignment of ratings to debt issued by insurers or supported by insurance policies follows:

Q. In India, credit agencies engaged in rating securities offered by public or rights issue must obtain a license from:

Q. Credit ratings are recognized worldwide as the benchmark for assessing the financial strength of:

Q. Sovereign rating assesses a country's overall strength for:

Q. The analytical process in evaluation by a rating agency includes all of the following measures, except:

Q. When managing the security of assets and finances, an insurer or reinsurer may decide to use credit rating information based on:

Q. What risk does dealing with reinsurance expose an insurer or reinsurer to?

Q. When managing reinsurance security, an insurer or reinsurer may offset the higher credit risk associated with reinsurance recoverables against:

Q. The decision of an insurer or reinsurer to override the lower sovereign rating and deal with a market based on the individual credit rating is primarily influenced by:

Q. Which of the following statements is incorrect with respect to credit rating?

Q. How were reinsurers traditionally chosen?

Q. What is the purpose of using credit ratings in the selection of reinsurers?

Q. What is the minimum credit rating required by IRDA in India for reinsurers?

Q. Can an insurer or reinsurer in any market set a higher rating level as an internal guideline for selecting a reinsurer?

Q. What is the initial step in selecting a reinsurer?

Q. What is the purpose of rating agencies' assessment of insurers and reinsurers?

Q. Which of the following is NOT a key area that a Credit Rating Agency looks at when assessing insurers?

Q. What is the role of rating in helping new insurers in a market?

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!