c6 ins200

What is the function of reinsurance?

• Transfer risk to primary insurer

• Share part of the large losses with the reinsurer

• Eliminate the need for primary insurance

• Increase the sum insured for the primary insurer

What is the purpose of a surplus treaty in reinsurance?

• To cover risks beyond the primary insurer's capacity

• To share large losses with the reinsurer

• To transfer all risks to the reinsurer

• To retain all risks within the primary insurer

What is the characteristic of semi-automatic proportional reinsurance?

• Only ceding company has the option to reinsure

• Reinsurance is mandatory for both parties

• Reinsurance is not allowed

• Both ceding company and reinsurer have the option to reinsure

What is the main purpose of retrocession in reinsurance?

• To eliminate the need for reinsurance

• To transfer risk to the primary insurer

• To transfer risk to the reinsurer

• To increase the sum insured for the reinsurer

What is the type of reinsurance where both ceding company and reinsurer have the option to reinsure?

• Automatic proportional reinsurance

• Non-automatic proportional reinsurance

• Surplus treaty reinsurance

• Facultative reinsurance

What is the main benefit of reinsurance for the primary insurer?

• To transfer risks beyond their capacity to the reinsurer

• To eliminate the need for insurance

• To increase the premium for the insured

• To reduce the sum insured for the reinsurer

What is the main function of a quota share treaty in reinsurance?

• To cover risks beyond the primary insurer's capacity

• To share large losses with the reinsurer

• To transfer all risks to the reinsurer

• To retain all risks within the primary insurer

What is the purpose of a reinsurance arrangement?

• To reduce the sum insured for the reinsurer

• To increase the premium for the insured

• To eliminate the need for insurance

• To transfer risk to the reinsurer