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AIAF 114 - CHAPTER 4 PRACTICE EXAM QUESTIONS QUIZZES & ANS!!
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AIAF 114 - CHAPTER 4 PRACTICE EXAM QUESTIONS QUIZZES & ANS!!
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AIAF 114 - CHAPTER 4PRACTICE EXAM
QUESTIONS QUIZZES &
ANS!!
AIAF 114
Evatee 9/10/24 AIAF 114
, AIAF 114 - CHAPTER 4 PRACTICE EXAM
QUESTIONS QUIZZES & ANS!!
Some premium payment plans may include additional payments that exceed
the amount required if the premium was paid in full at the policy inception.
Such additional payments that are a function of the amount of premium
payment are treated under U.S. regulatory accounting as Answer - Finance
charges.
Under U.S. regulatory accounting, the liability for extended reporting
endorsements covering a definite period into the future is recorded as Answer
- Unearned premium reserves
Retrospective premium adjustments Answer - Can continue for many years
after the original policy term has expired.
Deficiency in the loss reserves Answer - Does not necessarily indicate a
deficiency in the unearned premium reserve
The asset-liability approach may be used as a new accounting standard for
insurance contracts, rather than the deferral-matching approach. Under the
asset-liability approach, revenue is recognized Answer - When the insurer
gains control of the asset resulting from the revenue
Which one of the following might be a reason for a regulatory accounting
system to gross up the reported premiums by the amount of credits for large
deductible arrangements? Answer - To avoid a negative impact on smaller
insureds under a premium assessment system
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