Insurance Awareness - Reinsurance
What is the primary function of reinsurance in the insurance industry?
What is the primary function of reinsurance in the insurance industry?
easy Q1 of 15
Step-by-Step Solution
Step 1: Understand the concept of reinsurance
Reinsurance is a risk management tool where an insurer transfers part of its risk portfolio to another insurer (the reinsurer) to reduce the risk of large losses.Final Answer:
To transfer risk from one insurer to another to manage large exposures → Option BQuick Check:
To transfer risk from = definition ✅
Quick Trick: Reinsurance = insurer’s insurer.
Common Mistakes:
MISTAKES- Confusing reinsurance with direct insurance or regulatory functions.
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