Page 175 - Fire Insurance Ebook IC 57
P. 175
The Insurance Times
Question & Answers
Q1. Write sort notes on
a. What is underwriting - The term ' Underwriting' is
broadly used to denote the principles and practices
concerning, fixing of rates, the acceptance or rejection
of risks, the amount of acceptance, the amount of
retention by the insurer and amount transferred to the
reinsurers.
The ultimate objectives are :
(i) the production of a large volume of premium income
to sufficiently maintain and enlarge an insurer's
organization, and
(ii) the earning of a reasonable amount of profit on the
operations.
b. Process of selection of business - This involves
careful scrutiny of the business acceptance to make a
proper assessment of the fire hazards involved.
The right decision depends upon the insurers' assessment
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