Question

Why does securitization provide comfort to policyholders?

a.

It removes credit risk

b.

It increases coupon rates

c.

It converts assets into securities

d.

It provides higher capacities

Answer: (a).It removes credit risk Explanation:Securitization provides comfort to policyholders by removing credit risk since the capital is made available before the loss occurs.

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Q. Why does securitization provide comfort to policyholders?

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