Question

What is the significance of high self retentions in the reinsurance market?

a.

They increase the demand for reinsurance coverage.

b.

They lead to the withdrawal of premium from the property market.

c.

They reduce the need for captives in the insurance industry.

d.

They shift the focus to alternative markets for capacity.

Answer: (b).They lead to the withdrawal of premium from the property market. Explanation:High self retentions, which involve captives assuming a significant portion of the risk themselves, have led to the withdrawal of considerable premium from the world property market. Captives with professional managers have sought the best coverages at optimal prices, resulting in reduced reliance on traditional reinsurance and a shift in the market dynamics.

Interact with the Community - Share Your Thoughts

Uncertain About the Answer? Seek Clarification Here.

Understand the Explanation? Include it Here.

Q. What is the significance of high self retentions in the reinsurance market?

Similar Questions

Explore Relevant Multiple Choice Questions (MCQs)

Q. What decision did British Petroleum make regarding insurance coverage?

Q. What decision did British Petroleum make regarding insurance coverage?What is the main reason for increase in demand for ART products?

Q. Which of the following is considered an alternative risk transfer method?

Q. What is the objective of risk transfer?

Q. What does asset management refer to?

Q. What is the purpose of risk retention financing?

Q. What are derivative securities?

Q. How do derivatives contribute to risk management?

Q. What is the purpose of securitization in the insurance market?

Q. What does securitization allow issuers to do?

Q. What does Alternative Risk Transfer (ART) encompass?

Q. What is driving the increased demand for ART products?

Q. Which of the following is a technique of risk management?

Q. Market terrorism pool is an example of which of the following alternative carriers?

Q. ____________refers to the professional management of investments such as stocks and bonds along with real estate, set realistic goals to increase the insurer`s / reinsurer`s wealth and measure the performance.

Q. _____________is a device to transfer a part of business by an insurer to another insurer or reinsurer for a specified period and to appropriate the fund obtained by a transfer of business for policy reserves to strengthen its financial position

Q. __________ is a contract to pay back to the insurer the negative balance in his business as pre-agreed with the reinsurer.

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!