Question

What is the main idea behind a Finite Risk program?

a.

To provide unlimited risk coverage to insurers

b.

To limit the liability of insurers or reinsurers

c.

To transfer risk completely to policyholders

d.

To offer multi-year coverage with no limits

Posted under IC85 Reinsurance Management

Answer: (b).To limit the liability of insurers or reinsurers Explanation:The fundamental approach in a Finite Risk program is to have an ultimate limit of liability to the insurer or reinsurer, referred to as the "provider." This limitation sets a cap on the exposure that can be covered, providing a means to limit the liability.

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Q. What is the main idea behind a Finite Risk program?
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