Question

What is the requirement for general insurers in terms of outstanding claims provision for reinsurance arrangements?

a.

Provisions are not required

b.

Provisions are made based on loss information advices

c.

Provisions are made on an actuarial estimation basis

d.

Provisions are made based on loss information advices or actuarial estimations, whichever is convenient

Answer: (d).Provisions are made based on loss information advices or actuarial estimations, whichever is convenient Explanation:Every general insurer is required to make outstanding claims provision for every reinsurance arrangement accepted based on loss information advices received from Brokers / Cedants. In cases where such advices are not received, provisions are created on the basis of actuarial estimations.

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Q. What is the requirement for general insurers in terms of outstanding claims provision for reinsurance arrangements?

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