The Underwriting Function Is Designed to Be Sure That Premiums

question 41

Multiple Choice

The underwriting function is designed to be sure that premiums are based on

• A)income levels.
• B)the value of the loss.
• C)the value of the gain.
• D)the chance of loss.
• E)expense levels.

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Definitions:

Due Diligence

The investigation or exercise of care that a reasonable business or person is expected to take before entering into an agreement or transaction with another party.

Willful Violations

Deliberate or intentional breaches of the law or regulations, often implying awareness of the illegal nature of the act.

Securities Act of 1933

United States federal law enacted to regulate the sale of securities, requiring disclosure and registration of significant information.

Securities Litigation Uniform Standards Act of 1998

A United States federal law that preempts class-action lawsuits related to securities fraud from being brought under state law, requiring instead that they be brought under federal law.