SOLUTIONS 100% VERIFIED!!
Save
Terms in this set (150)
Underwriting criteria Answer 4: A, B, and C are correct - page 3.
generally used in the
pricing of preferred
policies include which of
the following?
A. blood pressure
B. cholesterol/HDL ratios
C. family history
Answer Options:
1. B only is correct.
2. C only is correct.
3. A and B only are
correct.
4. A, B, and C are correct.
,All the following are life Answer 4: asset risk - pages 6-7.
insurance pricing
components that are
established by regulation
EXCEPT:
1. reserve basis
2. tax law
3. non-forfeiture laws
4. asset risk
The relationship of Answer 2: protective value - page 8.
mortality savings from a
requirement to the cost of
administering the
requirement is:
1. surplus value
2. protective value
3. business value
4. reserve value
What are the components Refer to page 3.
considered by the actuary
in the pricing of new
products?
Describe the types of risk Refer to page 2.
that must be covered by
the allocated surplus.
,All the following Answer 3: It should measure the difference between
statements regarding a select and ultimate mortality—pages 8-9.
protective value study of
underwriting requirements
are correct EXCEPT:
1. It should evaluate which
requirement identified the
underlying impairment.
2. It should consider the
proposed insured's
behavior in accepting or
rejecting the offered
policy.
3. It should measure the
difference between select
and ultimate mortality.
4. It should ensure that the
offered product is "at the
market."
A safety net that needs to Answer 1: risk-based capital—page 7.
be provided beyond the
level of reserves being
held in case a company's
mortality experience turns
out to be much worse
than expected is referred
to as:
1. risk-based capital
2. reserve basis
3. statutory reserve
4. deferred acquisition
cost
, What items are included in Refer to page 5.
the expense levels that
are built into product
pricing?
Name four factors that Refer to pages 3-6.
could affect the
profitability of a product
and explain in what way
profitability could be
affected.
Describe how exceptions Refer to page 11.
can affect the profitability
and mortality of a product.
For direct carriers, the Answer 2: 50% - page 20.
average percent of
premium assigned to
cover mortality is:
1. 30%
2. 50%
3. 75%
4. 90%