Question

What is the purpose of a loss portfolio transfer in reinsurance?

a.

To discount loss reserves

b.

To supplement loss reserves

c.

To transfer outstanding losses to reinsurers

d.

All of the above

Posted under IC85 Reinsurance Management

Answer: (d).All of the above Explanation:A loss portfolio transfer allows insurers to effectively discount or supplement their loss reserves by transferring outstanding losses to reinsurers, thereby diminishing the loss reserve in the insurer's balance sheet.

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