Correct Answer : How Assets & Liabilities are valued
The surplus in an insurance company is a function of how Assets & Liabilities are valued. Surplus is also known as net worth or the difference between the market value of assets and the present value of the liabilities and their relationship
Correct Answer : More surplus
Correct Answer : Whole life
Variable Life Insurance is a kind of Whole life Insurance. Variable life insurance is a permanent life insurance policy with an investment component. The policy has a cash value account, which is invested in a number of sub-accounts available in the policy. A sub-account acts similar to a mutual fund, except it's only available within a variable life insurance policy.
Correct Answer : Terminate
Under Variable life insurance, if the cash value became zero, the policy would Terminate. Variable life insurance is a permanent life insurance product with separate accounts comprised of various instruments and investment funds, such as stocks, bonds, equity funds, money market funds, and bond funds.
Correct Answer : General investment account
In traditional cash value policies, the policy reserve form part of a General investment account. When an insurance company underwrites a new policy, it is paid a premium by the policyholder. These premiums are deposited into the insurer's general account.
Correct Answer : Special investment account
Correct Answer : All of the above
Risk Avoidance, Risk Retention and Risk Reduction are the methods to manage risks. There are four main ways to manage risk: risk avoidance, risk transfer, risk reduction and risk retention. Each is applicable under different
Correct Answer : Might, will
Insurance refers to protection against an event that might happen whereas Assurance refers to protection against an event that will happen.
Correct Answer : Inflation
Inflation is responsible for a rise in general price levels of goods and services in a nation’s economy. Inflation is a quantitative measure of the rate at which the average price level of a basket of selected goods and services in an economy increases over a period of time. It is the constant rise in the general level of prices where a unit of currency buys less than it did in prior periods.
Correct Answer : In endowment assurance survival up to the end of the term as well as in between death will give the claimant the benefits of the policy
