The Unearned Premium Reserve of an Insurer Is

question 47

Multiple Choice

The unearned premium reserve of an insurer is

• A)an asset representing the investments made with premium income.
• B)a liability representing the unearned portion of gross premiums on outstanding policies.
• C)a liability representing claims that have been filed,but not yet paid.
• D)the portion of the insurer's net worth belonging to policyowners.

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Definitions:

Salary

Regular payments made by an employer to an employee, typically on a monthly or biweekly basis, in exchange for professional services rendered.

Capital Balances

The amount of equity ownership a partner has in a partnership, often represented as the difference between their contributions to the partnership and any withdrawals.

Net Loss

Occurs when a company's expenses exceed its revenues during a specific period, indicating a negative financial performance.

Capital Account

An account on the balance sheet that shows the equity and debt investments into a country minus its investments abroad.