SOFE SOFE-AFE Online Practice Questions and Exam Preparation

SOFE SOFE-AFE Online Questions & Answers

• Question 181:

  Special surplus funds are portions of surplus allocated or appropriated for a specific purpose. Special surplus funds usually are allocated voluntarily but also may be required by an insurance regulator. Which one the following is NOT an example of special funds:

  A. Group contingency reserve
  B. Group annuity contingency reserve
  C. Participation is separate accounts
  D. Guarantee Loan
  D. Guarantee Loan

• Question 182:

  The Annual Statement reporting requirements for the participating and nonparticipating branches is limited to major and secondary lines of business, but a company would:

  A. Usually carry this separation throughout all of its premium classifications
  B. Do not carry this separation throughout all of its premium classifications
  A. Usually carry this separation throughout all of its premium classifications

• Question 183:

  Valuation technique should be used to measure fair value and is consistent with:

  A. market, income and risk approach
  B. market, performance and cost approach
  C. security, income and risk approach
  D. market, income and cost approach
  D. market, income and cost approach

• Question 184:

  According to Securities and Exchange Commission (SEC), "the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a person, whether through the ownership of voting shares, by contract, or otherwise" is called:

  A. Control
  B. Influence
  C. Activity
  D. Entitlement
  A. Control

• Question 185:

  For Generally Accepted Accounting Principles (GAAP), the four methods for reporting the results of operations and financial position of a subsidiary (investee) by a parent (investor) are:

  A. Renovation, Equity Basis, Market, Cost
  B. Consolidation, Equity Basis, Market, Cost
  C. Equity Basis, Market, Cost, Time
  D. Market, Cost, Performance, Time
  B. Consolidation, Equity Basis, Market, Cost

• Question 186:

  The risk that the obligation will not be fulfilled and affects the value at which the liability is transferred is known as:

  A. performance risk
  B. nonperformance risk
  C. hypothetical risk
  D. relocation risk
  B. nonperformance risk

• Question 187:

  When premium income less return premiums arising from policies issued or other contracts entered into reinsure other insurance entities that provide the related primary coverage are called:

  A. Indirect premiums
  B. Direct premiums
  C. Assumed reinsurance premiums
  D. Real reinsurance premiums
  C. Assumed reinsurance premiums

• Question 188:

  A premium deficiency relating to which insurance contracts indicate a probable loss on premiums yet to be earned.

  A. long duration
  B. premium policy
  C. short duration
  D. None of the above
  C. short duration

• Question 189:

  As defined in Accounting Standards Codification, dollar purchase agreements are the agreements to sell and repurchase similar and identical securities.

  A. True
  B. False
  B. False

• Question 190:

  The difference between the purchase price and the repurchase price, or sale price, plus accrued interest on the security represents:

  A. Accounting agreement
  B. Investment income
  C. Dollar price
  D. Saving price
  B. Investment income