SOFE SOFE Certification SOFE-CFE Questions & Answers

• Question 241:

  What contract usually includes a fixed commission rate and a fixed reinsurer's fee or profit factor?

  A. guaranteed profit

  B. profit compensator

  C. profit contract

  D. charge contract

  Correct Answer: A

• Question 242:

  Contracts between an insurance company and its agents can provide for what based upon the profitability of business produced?

  A. base commission

  B. acquisition reinsurance commission

  C. contingent commission

  D. persistent ratio commission

  Correct Answer: C

• Question 243:

  Amortization of the net actuarial gain or loss is to be included as a component of ________________benefit cost for a year

  A. net postretirement

  B. net preretirement

  C. Gross postretirement

  D. Gross preretirement

  Correct Answer: A

• Question 244:

  The growth contingent is based upon a relationship between:

  A. net investment and premium volume

  B. commissions and net income volume

  C. loss and adjustment volume

  D. profit and premium volume

  Correct Answer: D

• Question 245:

  In_____________, the actuary varies the assumptions and the models to test the sensitivity of the reported or carried loss liabilities.

  A. potential test

  B. latent test

  C. earned premium test

  D. prospective test

  Correct Answer: D

• Question 246:

  Which of the following is Correct?

  A. Interest cost on the preretirement benefit obligation at the beginning of the period is recognized during the period.

  B. Interest cost on the postretirement benefit obligation at the beginning of the period is recognized during the period.

  C. Interest cost on the postretirement benefit obligation at the end of the period is predicted during the period.

  D. Interest cost on the preretirement benefit obligation at the end of the period is recognized at the end of period.

  Correct Answer: B

• Question 247:

  The greater the number of exposure units insured during an origin year, the more claims that can be expected.

  A. True

  B. False

  Correct Answer: A

• Question 248:

  What affects claims from all origin periods and all development periods that are in the process of settling during a calendar period?

  A. Reserving

  B. Claim courts

  C. Inflation

  D. Accrual ratios

  Correct Answer: C

• Question 249:

  The actuary tests liabilities estimated in the past with the most recent information in which testing scheme?

  A. organizing testing

  B. retrospective testing

  C. trade fair testing

  D. Accrual based testing

  Correct Answer: B

• Question 250:

  What are most often used in actuarial studies of ratemaking or loss reserving?

  A. Loss and claim triangles

  B. Collision period triangles

  C. Non-adjustment period triangles

  D. Accident period triangles

  Correct Answer: C