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ii W01/March 2017 Award in General Insurance

Chapter 2 self-test answers

1. Buyers, insurers, intermediaries, price comparison websites (aggregators) and reinsurers.
2. Three from private individuals, corporate customers, associations and public bodies.
3. A limited liability/proprietary company is owned by its shareholders and a mutual company is
owned by its policyholders.
4. Reinsurers fall into both categories as they accept risks and also seek to transfer part of their
portfolio of risks to other reinsurers.
5. The role of the intermediary in the marketplace is to bring buyers and sellers together.
6. The benefits are:
• tax benefits on premiums paid to the captive company;
• avoidance of the direct insurer’s expenses; and
• buying reinsurance at a low cost.
7. A loss adjuster is an expert in processing claims from start to finish.
8. Any two of the following functions:
• Dealing quickly and fairly with claims.
• Distinguishing between real and fraudulent claims.
• Assessing the cost of a claim so that a realistic value is placed upon it prior to payment (this is the
process called reserving).
• Determining whether others, such as loss adjusters, need to be involved.
• Settling claims with minimum wastage. Reference copy for CII Face to Face Training