Question

Which of the following statements about credit ratings is true?

a.

Credit ratings are guarantees of an insurer's financial strength.

b.

Credit ratings assess an insurer's ability to meet non-policy obligations.

c.

Credit ratings are recommendations to purchase or discontinue policies.

d.

Credit ratings are determined by auditors and accountants.

Answer: (b).Credit ratings assess an insurer's ability to meet non-policy obligations. Explanation:Credit ratings do not refer to an insurer's ability to meet non-policy obligations. Instead, they specifically focus on an insurer's ability to meet obligations related to insurance policies and contracts.

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

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