Which of the Following Statements About the Regulation of Insurance

question 1

Multiple Choice

Which of the following statements about the regulation of insurance company investments is (are) true?
I.The purpose of regulating insurance company investments is to prevent insurers from making unsound investments which could threaten their solvency.
II.Life insurers must invest their separate account assets in bonds.

• A)I only
• B)II only
• C)both I and II
• D)neither I nor II

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Definitions:

Total Assets

The combined value of all owned resources that have economic value and can be converted into cash. This includes both current and non-current assets.

Quick Ratio

A measure of a company's ability to meet its short-term obligations with its most liquid assets.

Total Current Assets

The sum of all assets that are expected to be converted into cash, sold, or consumed within one year or the normal operating cycle, whichever is longer.

Current Liabilities

A company's debts or obligations that are due to be paid to creditors within one year.