American Museum of Natural History Richard Gilder Insurance Accounting Questions

Insurance

Assignment 2

Instructions – PLEASE READ THEM CAREFULLY

The Assignment must be submitted on Blackboard (WORD format only) via allocated folder.

Assignments submitted through email will not be accepted.

Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page.

Students must mention question number clearly in their answer.

Late submission will NOT be accepted.

Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.

All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).

Submissions without this cover page will NOT be accepted.

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Assignment Question(s):

Q1. Read the following features related with types of reinsurances and identify the correct type of reinsurance: (1 Marks)

a)This type of reinsurance is also termed as stop loss reinsurance.

b)In this type agreement, the policyholder is unaware about any indemnity reinsurance transactions pertaining to original contract.

c)This type of reinsurance is related with either retaining all claims up to a particular and stated amount by the insurer or retaining each risk.

d)In this type of insurance, the policyholder is required to provide the necessary consent to releasing the ceding company.

Q2. Structures of insurance companies’ financial statements (income statement, balance sheet, cash flow statements) vary than structures the non- insurance organization due to the unique features of the insurance companies. Give a sample of the structures for any selected Saudi insurance company’ financial statements and explain the rational for classifying balance sheet accounts. Write no less than 300 words (2marks)

Q3. Explain how three of the following elements can affect estimate of loss reserve. (2 marks)

üThe claims-handling process

üPolicy and exposure forms

üInflation

üLegal trends

üEnvironmental factors

üMix of claimants

üTimeliness of claim reporting by claimants

no copy ever