SOFE SOFE-AFE Online Practice Questions and Exam Preparation

SOFE SOFE-AFE Online Questions & Answers

• Question 201:

  In which policies the contract provides for insurance coverage for a fixed period of duration and enables the insurer to not renew the contract or adjust the provisions of the contract at the end of the contract period?

  A. Short duration
  B. Policy duration
  C. Contract duration
  D. None of the above
  A. Short duration

• Question 202:

  A stock life insurance company writing both participating and nonparticipating business must follow special accounting procedures under the laws of certain jurisdictions. The purpose of these special accounting procedures is to provide for:

  A. A separation of accounting, so that profits applicable to participating and nonparticipating business can be appropriately determined
  B. This is a critical process, since profits from participating business are regulated as to their distribution among participating policyholders and the company's stockholders
  C. Some jurisdictions require the filing of several of the statutory statement exhibits in three forms, one for the company as a whole
  D. Any of these
  A. A separation of accounting, so that profits applicable to participating and nonparticipating business can be appropriately determined

• Question 203:

  An annuity contract provides:

  A. Either immediately or at some future date, periodic income payments to one or more persons, perhaps with a certain guaranteed number of payments or with a minimum guaranteed amount for those annuities not having life contingencies
  B. Either immediately or at some future date, periodic income payments to one or more persons, perhaps with a certain guaranteed number of payments or with a minimum guaranteed amount for those annuities involving life contingencies
  C. Either immediately or at some future date, perpetual income payments to one or more persons, perhaps with a certain guaranteed number of payments or with a maximum guaranteed amount for those annuities involving life contingencies
  D. Either immediately or at some future date, periodic income payments to one or more persons, perhaps with a certain small number of payments
  B. Either immediately or at some future date, periodic income payments to one or more persons, perhaps with a certain guaranteed number of payments or with a minimum guaranteed amount for those annuities involving life contingencies

• Question 204:

  Financial Statements provide additional valuable information on the loans. Some of the more significant information provided includes EXCEPT:

  A. The valuation of the mortgage loan portfolio, including a description of the valuation basis for mortgage loans and income recognition
  B. The recorded investment and interest past due on mortgages with interest more than 90 days past due
  C. The recorded investment and number of mortgages on which interest has been reduced, and the percent the interest was reduced
  D. Disclosures of impaired loans: The total recorded investment in impaired loans at the end of each period
  B. The recorded investment and interest past due on mortgages with interest more than 90 days past due

• Question 205:

  It usually is acceptable to use the subsidiary's statements if the difference in fiscal periods is:

  A. not more than 2 months
  B. not more than 3 months
  C. not more than 4 months
  D. not more than 5months
  B. not more than 3 months

• Question 206:

  Which of the following is the objective to the evaluation and risk-accepting function?

  A. Evaluating and acceptability of risk
  B. Determining the premium
  C. Evaluation of entity's capacity to retain risk
  D. All of the above
  D. All of the above

• Question 207:

  Audit risk consists of:

  A. Risk of material misstatement
  B. detection of risk
  C. Both A and B
  D. Neither A nor B
  C. Both A and B

• Question 208:

  What give the issuer the right to retire the bond at certain times, typically if prevailing market interest rates fall below the rate on the bond?

  A. Call options
  B. Prepayment provisions
  C. Variable income statements
  D. Investments modules
  A. Call options

• Question 209:

  What is the second-order measure of the interest rate sensitivity of an instrument and the sensitivity of duration to changes in interest rates?

  A. Complexity
  B. Convexity
  C. Time compliance
  D. Performance measure
  B. Convexity

• Question 210:

  The methods used for the premium rates establishment are:

  A. Manual, judgmental and premium rating
  B. Commercial, judgmental and merit rating
  C. Manual, experimental and merit rating
  D. Manual, judgmental and merit rating
  D. Manual, judgmental and merit rating