Author Question: Which of the following conditions is (are) appropriate for using retention? I. Losses are difficult ... (Read 89 times)

Anajune7 · **on:** Jul 11, 2018

Which of the following conditions is (are) appropriate for using retention? I. Losses are difficult to predict. II. The worst possible loss is not serious.

A) I only
B) II only
C) both I and II
D) neither I nor II

Question 2

Which of the following statements regarding the use of retention is (are) true?

I. Retention is best used for loss exposures that have a low frequency and a high severity.
II. A financially strong firm can have a higher retention level than a firm whose financial position is weak.
A) I only
B) II only
C) both I and II
D) neither I nor II