SOFE SOFE Certification SOFE-CFE Questions & Answers

• Question 221:

  When gross premiums written are reduced by ceded reinsurance premiums in financial statements, the result is termed as:

  A. net premiums written

  B. ceded premiums

  C. net analyzed premiums

  D. earn premiums written

  Correct Answer: A

• Question 222:

  Special general ledger controls over such billed amounts that are not yet due (until their effective dates) typically are used for administering the billing function; these special controls may be referred to as:

  A. memoranda

  B. bills

  C. letters

  D. premiums

  Correct Answer: A

• Question 223:

  Prior to codification, Statutory Accounting Practices (SAP) allowed recognition of premium by:

  A. when processed

  B. when due

  C. when paid

  D. All of the above

  Correct Answer: D

• Question 224:

  At the completion of the audits of policies, when the actual amount of _________________ is known, companies are required to adjust the estimate through the revenue accounts.

  A. Earned and billed Premiums

  B. Unearned but billed Premiums

  C. Earned but Unbilled Premiums

  D. Unearned and Unbilled Premiums

  Correct Answer: C

• Question 225:

  Date recorded, Effective and expiration dates, Geographic location, Company, Producer are all needs for the identification of:

  A. premium amounts

  B. transaction

  C. reinsurance

  D. coding

  Correct Answer: D

• Question 226:

  Premiums and commissions coded as premiums receivable, premiums written, and commission expense can be accumulated to provide summary control data for entry into the:

  A. journal

  B. general ledger

  C. Financial statement

  D. balance sheet

  Correct Answer: B

• Question 227:

  The price charged by the reinsurer under such a contract that represents reinsurance premium commonly known as:

  A. agreement

  B. treaty

  C. settlement

  D. treasury

  Correct Answer: B

• Question 228:

  An insurer's premiums written are comprised of which premiums derived from policies and policy endorsements entered in a given accounting period.

  A. aggregate

  B. Unearned

  C. reinsurance

  D. Earned

  Correct Answer: A

• Question 229:

  The amount of premiums written is generally used as a basis for determining compensation paid to the agent, called:

  A. collection

  B. revenues

  C. commission

  D. earning

  Correct Answer: C

• Question 230:

  Insurance protection sold by an insurer is described in a written agreement (contract) between an insurance company and the insured, called:

  A. concurrence

  B. statement

  C. policy

  D. Guideline

  Correct Answer: C