Examkin

Soru

Zorluk: ZorRisk Classification

During the risk assessment of a proposed insured, an underwriting department identifies two distinct factors: a progressive medical condition (Type 2 diabetes) that causes mortality risk to increase as the insured ages, and active participation in a hazardous avocation (cave diving) where the mortality risk remains constant regardless of age. According to actuarial principles, which of the following describes how the insurer will most likely classify and rate this application?

  1. Classify the applicant as a substandard risk, applying a tabular rating to address the medical condition and a flat extra premium for the hazardous avocation.Cevap
  2. B
    Classify the applicant as a substandard risk, applying a flat extra premium to address the medical condition and a tabular rating for the hazardous avocation.
  3. C
    Issue the policy with a standard risk classification, but apply a unified tabular rating surcharge to simultaneously cover the combined risk of both factors.
  4. D
    Decline the application entirely, because combining a progressive physical hazard with a dangerous avocation transforms the exposure into an uninsurable speculative risk.

Cevap

The insurer will classify the applicant as a substandard risk, using a tabular rating to account for the medical condition and a flat extra premium for the avocation.
The applicant represents a substandard risk due to the combination of hazards. Medical conditions that progressively worsen with age are actuarially addressed using a tabular rating, which increases the base premium by a percentage to match the compounding risk. Conversely, hazardous avocations that present a constant, non-aging danger are addressed using a flat extra premium (a set dollar amount added per thousand dollars of coverage). Insurers combine these methods to precisely match the premium to the specific types of risk presented by the applicant.

Adım Adım Çözüm

1
Evaluate the impact of the progressive medical condition on the applicant's risk profile.
The medical condition increases mortality risk with age, requiring a substandard classification adjusted by a tabular (table) rating.
Tabular ratings apply a percentage surcharge to the base premium to account for health impairments that compound over time.
2
Evaluate the impact of the hazardous avocation on the applicant's risk profile.
The cave diving presents a constant mortality hazard that does not biologically age, requiring a flat extra premium.
Flat extra premiums add a specific dollar amount per thousand of coverage to account for occupational or avocational hazards that remain static.
3
Synthesize the rating methodologies for the final underwriting decision.
The applicant is issued a substandard policy that incorporates both the tabular rating and the flat extra premium.
Insurers routinely combine different rating structures on a single policy to accurately reflect multifaceted, distinct risk exposures.

Anahtar Kavram

Substandard Risk Rating Methodologies
Bu soruyu puanla

Konular

Risk Classification

Bu konudan daha fazla soru