According to Securities and Exchange Commission (SEC), “the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting shares, by contract, or otherwise†is called:
The organizations in which the ownership and control of operations are vested in the policyholders are known as:
What represent the ownership interests in the net assets of the subsidiary held by persons outside the controlling entities’ structure?
The financial statements of which accounts maintained by insurance company that must be presented separately from the insurance company’s general account business?
Inflation in Defense & Cost Containment (DCC) is evaluated separately and is estimated to occur at the same rate as the rate of inflation in the losses.
What seeks to identify and exploit existing or potential synergies in a company’s diverse business activities?
The entity transferring the risk is called the ceding entity and the entity to which the risk is transferred is called the assuming entity.
Many companies have developed an asset/liability management approach that is founded on understanding product liabilities. Mortgages meet the primary objective of maintaining:
The estimated liability includes the amount of money that will be used for future payments of:
_______ include financial statements and notes, both on a consolidated and non consolidated basis.
The operating ratio is the combined ratio less than the ratio of investment income, to earned premiums.
What encompasses investment income and gains and losses, as well as custody of investment and recordkeeping?
The amount that currently would be required to replace the service capacity of an asset is called:
There is pending litigation concerning the acquisition of a subsidiary and it is probable such litigation will result in its divestiture is an example of:
When securities repurchased under repos commonly have a principal amount that differs from principal amount of the security originally sold under the agreement, is known as:
In which plan all activities writing automobile insurance in a state are allocated a share of the involuntary business on an equitable basis?
When no tax deductions are allowed if risks are not transferred, whereas premiums paid to insurers are tax deducible, this leads to the formation of:
Which of the following is the objective to the evaluation and risk-accepting function?
It refers to items such as interest paid on proceeds from the date due to the date actually disbursed, and to interest on premium deposit funds. These interest items are reflected by the increase in reserves or liability, from one year to the next. What is it?
Coverage of risks that do not fit normal underwriting patterns and that are not commensurate with standard rates is normally refers to as:
Adjusting and Others (AO) reserves are often provided for by using the calendar year paid-to-paid method rather than the accident year paid-to-paid method used for Inflation in Defense & Cost Containment (DCC) reserves.
The balloon payment technique uses level payments of principal and interest but for a shorter period than is required to retire the loan fully during its term. For example, a loan with a 8.5 percent interest rate utilizing a 25-year amortization schedule with a 7-year maturity results in only $111 of each $l,000 principal being repaid. Thus, $889 of each $l,000 originally borrowed constitutes the balloon amount due at maturity.
To meet informational demands, internal management reporting will entail alternate views of the organization’s financial performance. These areas, or views, are including all of the following EXCEPT:
With which standard, the auditor’s substantive procedures must include reconciling the financial statements to the accounting records and should include examining material adjustments made during the course of preparing the financial statements.
When a retained asset account is established in the place of a cash settlement, an interest bearing account is created by the insurer for the beneficiary. The beneficiary receives a checkbook with which to draw upon funds in the new account. The account holder can make:
Prepayment of a conventional mortgage loan, prior to its specified maturity, is discouraged through the general market acceptance of significant prepayment penalties. Often these penalties are calculated so that when prevailing market interest rates are:
Special surplus funds are portions of surplus allocated or appropriated for a specific purpose. Special surplus funds usually are allocated voluntarily but also may be required by an insurance regulator. Which one the following is NOT an example of special funds:
Audit regulatory is more reliable when it is obtained from knowledgeable independent sources inside the entity.
Evidences the fair market value of the property that is security for the mortgage loan. The appraisal value is used to determine that the loan to market value ratio is in compliance with regulatory requirements. It also is used to determine any non-admitted mortgage loan amount. Appraisals are obtained from:
Outgoing premiums less return premiums arising from reinsurance purchased from other insurance entities are called:
A package of coverage including most property and liability coverage except workers’ compensation, automobile insurance and surely bonds is called:
Generally, Participation income is an income stream due the company and is based upon the financial results of the borrower and/or borrowing business entity. Although it can take several forms, the more prominent ones are:
Monetary items and non-monetary items carried at market value are translated into the reporting currency at the rate of exchange in effect on the balance sheet date under:
The securities repurchased have the same stated interest rate as, and maturities similar to, the securities sold and are generally priced to result in substantially the same yield is known as: