Part 4: Core Functions of an Insurance Company
Paper I — Principles and Practice of Insurance · Part 4: Core Functions of an Insurance Company
Further reading: Core Functions of an Insurance Company study notes →
Which of the following best describes the product development function of an insurance company?
Why: Because competitors are eager to copy, product development is a never-ending process. Even compulsory classes have flexibility in presentation. The department develops new products, monitors trends, sets exclusions/conditions and determines policy wording.
Which of the following is NOT a key factor considered by an underwriter when assessing a risk?
Why: Underwriting is the assessment of risk for insurance purposes. Key factors include nature of risk, claims history and exposure. The applicant's favourite colour is unrelated to risk assessment; outcomes may be acceptance, sub-standard terms, decline or referral to reinsurers.
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