Question

What is the purpose of reserving in the insurance industry?

a.

Settling claims instantly

b.

Holding claims amounts in reserve

c.

Maximizing sales

d.

Protecting the insurer's interests

Answer: (b).Holding claims amounts in reserve Explanation:Reserving in the insurance industry involves holding claim amounts in reserve until the payments are due, as insurers may not be able to settle claims instantly.

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Q. What is the purpose of reserving in the insurance industry?

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