What protects the confidentiality of the material in both the report and the summary, and provides legal protection to the appointed actuary except in cases of fraud or willful misconduct by the actuary?
A. Actuarial law
B. Actuarial opinion summary
C. model law
D. assessment procedure
Estimating the premiums needed to fund future promises is called:
A. Prospective funding
B. imminent procedure
C. ratemaking
D. potential funding
The task of estimating the liabilities for promises already made and not yet satisfied is called:
A. reserving
B. prospecting
C. ratemaking
D. contentment
Market risk and reinvestment risk underscore the need for:
A. asset-liability matching
B. revenue-risk matching
C. Prepayment risk
D. credit reinsurance
The greater interest rate sensitivity of the long-term asset will cause a reduction in the value of that asset which is lesser than the corresponding increase in the value of the short-term liability.
A. True
B. False
The primary reason for asset-liability matching is:
A. credit-balance
B. debit-balance
C. liquidity
D. None of the above
Which is the risk that a security will decline in value over time?
A. Credit risk
B. Market risk
C. Commodity risk
D. Technology risk
For bonds, which of the following is NOT the key component of market risk?
A. Interest rate risk
B. Call risk
C. Liquidity risk
D. Investment risk
What is the main goal of a prudent investment strategy?
A. risk/return considerations
B. maximization of investable assets
C. maintaining sufficient liquidity through an asset-liability matching strategy
D. All of the above
The role of which functions of an insurance company is to use and manage the funds generated in the other parts of the business to maximize the profitability of the entity as a whole?
A. cash and credit
B. investment and treasury
C. insurance and treasury
D. investment and revenues
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