The policyholders' surplus of an insurer is defined as the difference between its
A) assets and its liabilities.
B) premium income and its expenses.
C) reserves and its liabilities.
D) assets and its nonadmitted assets.
Question 2
Which of the following statements about the use of risk-based capital requirements is (are) true?
I. Insurers must have a certain amount of capital depending on the riskiness of their investments and insurance operations.
II. Insurers may be required to take certain actions depending on how much capital they have relative to their risk-based capital requirements.
A) I only
B) II only
C) both I and II
D) neither I nor II
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