Insurance Awareness - Reinsurance
Who primarily benefits from the reinsurance risk sharing mechanism?
Who primarily benefits from the reinsurance risk sharing mechanism?
easy Q13 of 15
Step-by-Step Solution
Step 1: Identify the beneficiary
Reinsurance helps primary insurers by sharing their risk, thus protecting their solvency and underwriting capacity.Final Answer:
Primary insurers by reducing their risk exposure → Option CQuick Check:
Policyholders do not claim directly from reinsurers; the primary insurer benefits by risk sharing.
Quick Trick: Remember: Reinsurance supports insurers, not policyholders directly.
Common Mistakes:
MISTAKES- Assuming policyholders or regulators benefit directly from reinsurance risk sharing.
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