Question

What is the Required Solvency Margin (RSM)?

a.

The amount of capital required to be kept by the insurance as buffer over and above the reserves of the policies

b.

The minimum reserve required by regulatory authorities for each insurance policy

c.

The total assets held by the insurance company

d.

The premium income generated from insurance policies

Answer: (a).The amount of capital required to be kept by the insurance as buffer over and above the reserves of the policies Explanation:The Required Solvency Margin (RSM) is the additional amount of capital required to be kept by the insurance as buffer over and above the reserves of the policies to ensure financial stability.

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Q. What is the Required Solvency Margin (RSM)?

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