Aiaf 114 - Study guides, Class notes & Summaries

Schedule F in the NAIC Annual Statement for LIFE insurers concerns - Answer-Contested and compromised claims Premiums are recognized as revenue when due for - Answer-Traditional life and annuity contracts Which one of the following is an asset on the balance sheet of life insurers but not PC insurers - Answer-Contract loans Changes in life insurers' liability for future policy benefits are - Answer-Recognized as expenses in the period in which the changes occur Which one of the following...

AIAF 114- Chapter 5 Practice Exam | Actual Exam Questions | 100% Correct Answers | Verified 2024 Version When accounting for accident-year losses for year 20X6, which one of the following would be included? - A reserve change in 20X7 for a loss that occurred in 20X6 Correct. When accounting for accident-year losses for year 20X6, a reserve change in 20X7 for a loss that occurred in 20X6 would be included. An accident-year method aggregates incurred losses for a given period (such as twe...

When accounting for accident-year losses for year 20X6, which one of the following would be included? - A reserve change in 20X7 for a loss that occurred in 20X6 Correct. When accounting for accident-year losses for year 20X6, a reserve change in 20X7 for a loss that occurred in 20X6 would be included. An accident-year method aggregates incurred losses for a given period (such as twelve months) using all incurred losses for insured events that occurred during that period. Any losses that oc...

Generally Accepted Accounting Principles (GAAP) A common set of accounting standards and procedures used in the preparation of financial statements to ensure consistency of presentation and reported results. Statutory Accounting Principles (SAP) The accounting principles and practices that are prescribed or permitted by an insurer's domiciliary state and that insurers must follow. The five basic assertions of accounting are that the financial information is: complete; valued correctly...

Schedule F in the NAIC Annual Statement for LIFE insurers concerns - ANSWER-Contested and compromised claims Premiums are recognized as revenue when due for - ANSWER-Traditional life and annuity contracts Which one of the following is an asset on the balance sheet of life insurers but not PC insurers - ANSWER-Contract loans Changes in life insurers' liability for future policy benefits are - ANSWER-Recognized as expenses in the period in which the changes occur Which one of the foll...

When premiums earned during any specific accounting period are less than incurred losses plus underwriting expenses incurred during the period, there will be an - ANSWER-Underwriting loss. A principal liability of insurers is the unearned premium reserve. Which one of the following statements best describes the unearned premium reserve? - ANSWER-The unearned premium reserve represents premiums paid but not yet earned Unrealized capital gains are not included in accounting income. Under sta...

Some premium payment plans may include additional payments that exceed the amount required if the premium was paid in full at the policy inception. Such additional payments that are a function of the amount of premium payment are treated under U.S. regulatory accounting as - ANSWER-Finance charges. Under U.S. regulatory accounting, the liability for extended reporting endorsements covering a definite period into the future is recorded as - ANSWER-Unearned premium reserves Retrospective pre...

The method most commonly used by PC insurers to recognize premium is - ANSWER--deferral-matching Deferral-Matching: Any prem charged on a policy before its effective date will be: - ANSWER--Deferred and not recognized as written premium until the effective date Deferral-Matching: Prem rev for a particular policy during a particular period equals: - ANSWER--writ prem during the period + beg UEP less the ending unearned prem liab Deferral-Matching: Actual Premium billing process - ANSWER-...

Non-admitted assets - ANSWER-Types of property, such as office furniture and equipment, that regulators do not allow insurers to show as assets on financial statements because these assets cannot readily be converted to cash at or near their market value Admitted Assets - ANSWER-Assets meeting minimum standards of liquidity that an insurer is allowed to report on its balance sheet in accordance with statutory accounting principles Unauthorized reinsurer - ANSWER-A reinsurer that is not lic...