SOFE SOFE-AFE Online Practice Questions and Exam Preparation

SOFE SOFE-AFE Online Questions & Answers

• Question 101:

  A substantial investment is defined as any investment comprising more than 15 percent of an enterprise's voting shares or greater than 35 percent of its equity.

  A. True
  B. False
  B. False

• Question 102:

  These are securities whose underlying assets consist of commercial mortgage loans. The commercial loans are pooled, which brings diversification and liquidity to the asset class. What are these?

  A. Conventional securities
  B. CMBS
  C. Subordinated securities
  D. Securitization
  B. CMBS

• Question 103:

  What seeks to identify and exploit existing or potential synergies in a company's diverse business activities?

  A. Appropriate business decisions
  B. Holistic techniques
  C. Collateral strategies
  D. Reimbursement activities
  B. Holistic techniques

• Question 104:

  Interest rates are a key element of any option pricing exercise because cash flows are discounted at interest.

  A. True
  B. False
  B. False

• Question 105:

  From what the most direct value-based requirements arise which are present in account value accumulation products?

  A. profit margins
  B. policy holding rates
  C. implicit interest rates
  D. withdrawal provisions
  D. withdrawal provisions

• Question 106:

  A holistic analysis in a multi-scenario framework of all significant factors that can affect an insurer's future financial condition is called:

  A. Insurance resting (IT)
  B. Dynamic solvency testing (DST)
  C. Financial testing (AT)
  D. Adequacy testing (AT)
  B. Dynamic solvency testing (DST)

• Question 107:

  With the advent of adjustable rate mortgages, amortization schedules are adjusted periodically as dictated by the terms of the loan agreement. A _____________file is used to indicate when to adjust the rate. Most computer software systems can adjust amortization schedules by reminding the company of change dates, accept current rate adjustments, and to produce new schedules.

  A. Automated software
  B. Tickler or reminder
  C. Emergency
  D. Excel
  B. Tickler or reminder

• Question 108:

  What represents the amounts needed to provide for the estimated ultimate cost of settling claims relating to insured events that have occurred on or before a particular date?

  A. Independent claim adjustment
  B. Payment of claims
  C. Insured claim adjustments
  D. Claim adjustment expenses
  D. Claim adjustment expenses

• Question 109:

  What is based on statistical data and are large groups of similar risks can be classified by a few and easily identifiable characteristics and result in standard rates?

  A. Numerical rating
  B. Premium rating
  C. Manual rating
  D. Item rating
  C. Manual rating

• Question 110:

  What represent the ownership interests in the net assets of the subsidiary held by persons outside the controlling entities' structure?

  A. External control
  B. Minority interests
  C. Permanent stockholder
  D. None of the above
  B. Minority interests