A Reinsurance Contract That Is Entered into on a Case-By-Case

question 28

Multiple Choice

A reinsurance contract that is entered into on a case-by-case basis after an application for insurance is received by a primary insurer is called

• A)a reinsurance pool.
• B)automatic treaty reinsurance.
• C)retrocession.
• D)facultative reinsurance.

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Definitions:

Certainty Effect

The tendency for people to overvalue outcomes that are certain compared to those that are only probable.

Reactance

A motivational reaction to offers, persons, rules, or regulations that threaten or eliminate specific behavioral freedoms, prompting a desire to regain them.

Reactance Theory

A psychological theory suggesting that people have an aversive reaction to restrictions of their freedoms, leading to a motivation to regain them.

Forbidden Behaviors

Acts that are prohibited or discouraged within a society or group due to cultural, social, or legal norms and values.