Question

What is the requirement regarding the maintenance of retention by general insurers according to the IRDA (General Insurance – Reinsurance Regulations) 2000?

a.

Maximum retention is not specified.

b.

Maximum retention should be 50% of the total business volume.

c.

Maximum retention should be commensurate with the financial strength and volume of business.

d.

Maximum retention should be at least 75% of the total business volume.

Answer: (c).Maximum retention should be commensurate with the financial strength and volume of business. Explanation:General insurers should maintain the maximum possible retention commensurate with their financial strength and volume of business.

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Q. What is the requirement regarding the maintenance of retention by general insurers according to the IRDA (General Insurance – Reinsurance Regulations) 2000?

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