Premium Bases Mortality And Morbidity Rates MCQs

Welcome to our comprehensive collection of Multiple Choice Questions (MCQs) on Premium Bases Mortality And Morbidity Rates, a fundamental topic in the field of IC 92 Actuarial Aspects of Product Development. Whether you're preparing for competitive exams, honing your problem-solving skills, or simply looking to enhance your abilities in this field, our Premium Bases Mortality And Morbidity Rates MCQs are designed to help you grasp the core concepts and excel in solving problems.

In this section, you'll find a wide range of Premium Bases Mortality And Morbidity Rates mcq questions that explore various aspects of Premium Bases Mortality And Morbidity Rates problems. Each MCQ is crafted to challenge your understanding of Premium Bases Mortality And Morbidity Rates principles, enabling you to refine your problem-solving techniques. Whether you're a student aiming to ace IC 92 Actuarial Aspects of Product Development tests, a job seeker preparing for interviews, or someone simply interested in sharpening their skills, our Premium Bases Mortality And Morbidity Rates MCQs are your pathway to success in mastering this essential IC 92 Actuarial Aspects of Product Development topic.

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Premium Bases Mortality And Morbidity Rates MCQs | Page 3 of 10

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Q21.
What factor influences the decision on mortality rates used by insurers?

a.

Distribution channels

b.

Underwriting expenses

c.

Historical investigations

d.

Expected change in experience over time

Discuss
Answer: (b).Underwriting expenses Explanation:The decision on mortality rates used by insurers is influenced by factors such as underwriting expenses, considering the relative pros and cons of various factors.
Q22.
Why is it important to assess the expected change in experience over time?

a.

To determine the profitability of the contract

b.

To estimate the impact of medical advances on mortality rates

c.

To evaluate the effectiveness of distribution channels

d.

To adjust the underwriting controls

Discuss
Answer: (b).To estimate the impact of medical advances on mortality rates Explanation:Assessing the expected change in experience over time helps insurers estimate the impact of medical advances and other factors on mortality rates.
Q23.
How often are historical investigations typically conducted?

a.

Every year

b.

Every ten to fifteen years

c.

Quarterly

d.

Monthly

Discuss
Answer: (b).Every ten to fifteen years Explanation:Historical investigations are typically conducted every ten to fifteen years to assess trends and changes in mortality rates.
Q24.
Which type of insurance contract is considered to have higher mortality risk?

a.

With profit endowment contract

b.

Pure term insurance

c.

Short term policies

d.

Unit-linked products

Discuss
Answer: (b).Pure term insurance Explanation:Pure term insurance contracts are considered to have higher mortality risk compared to other types of insurance contracts.
Q25.
Why are long-term policies considered riskier in terms of mortality rates?

a.

They have lower premiums

b.

They involve higher underwriting expenses

c.

They are more difficult to predict

d.

They offer greater flexibility

Discuss
Answer: (c).They are more difficult to predict Explanation:Long-term policies are considered riskier in terms of mortality rates because of the difficulty in predicting future mortality and other factors over an extended period.
Q26.
Why is the available mortality experience within the company or industry important for determining mortality rates?

a.

It helps in assessing the profitability of the contract

b.

It provides insights into the trends that are expected to continue

c.

It influences the choice of distribution channels

d.

It affects the underwriting controls applied

Discuss
Answer: (b).It provides insights into the trends that are expected to continue Explanation:The available mortality experience within the company or industry helps in understanding the trends that are expected to continue, aiding in the determination of mortality rates.
Q27.
What role do reinsurer's rates play in determining mortality rates?

a.

They provide insights into the target market for the contract

b.

They influence the selection of underwriting controls

c.

They offer information about past mortality experience

d.

They provide additional data about expected trends

Discuss
Answer: (d).They provide additional data about expected trends Explanation:Reinsurer's rates provide additional data about expected trends, helping in the determination of mortality rates.
Q28.
Why is past experience of mortality rates in the economy important?

a.

It determines the extent of underwriting controls applied

b.

It helps in estimating the operational risks involved

c.

It provides insights into medical developments within the country

d.

It influences the choice of distribution channels

Discuss
Answer: (c).It provides insights into medical developments within the country Explanation:Past experience of mortality rates in the economy provides insights into medical developments within the country, which is crucial for determining mortality rates.
Q29.
How do overseas operations of an insurer impact the determination of mortality rates?

a.

They increase operational risks

b.

They provide additional data for estimation

c.

They influence the choice of distribution channels

d.

They affect the selection of underwriting controls

Discuss
Answer: (b).They provide additional data for estimation Explanation:Overseas operations of an insurer provide additional data for estimation, aiding in the determination of mortality rates.
Q30.
What operational risk is associated with the acceptance of claims?

a.

Currency risk

b.

Fraud risk

c.

Interest rate risk

d.

Market risk

Discuss
Answer: (b).Fraud risk Explanation:Fraud risk, such as the occurrence of fraudulent claims, is associated with the acceptance of claims and poses an operational risk to insurers.
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