Which of the Following Statements About the Licensing of Insurance

question 56

Multiple Choice

Which of the following statements about the licensing of insurance companies is (are) true?
I.A new capital stock insurer must meet minimum capital and surplus requirements,which vary by state and line of insurance.
II.The licensing requirements for insurance companies are less stringent than those imposed on most other types of firms.

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

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Definitions:

Unfunded Pension Liability

The gap between the pension benefits promised to employees and the actual amount of funds available to meet those obligations.

Long-term Liability

Financial obligations of a business that are due beyond the current fiscal year or operating cycle.

SUTA Payable

State Unemployment Tax Act payable, a liability account for taxes owed by employers to state unemployment insurance programs.

Social Security Tax

Taxes collected by the government from employees and employers to fund the Social Security program, providing retirement, disability, and survivors' benefits.