IIA Exam IIA-CFSA Topic 7 Question 35 Discussion

Actual exam question for IIA's IIA-CFSA exam

Question #: 35
Topic #: 7

[All IIA-CFSA Questions]

The ''combined ratio'' of an insurance company is the ratio from combining which of the following?

1. The ''loss ratio.''

2. The ''other underwriting expense ratio.''

3. The ''expense ratio.''

4. The ''IBNR.''

AI and II only.

BI and II only.

CIII and IV only.

DI, II, III and IV.

Show Suggested Answer

Suggested Answer: C

by Brett at Jul 03, 2023, 05:04 PM

Limited Time Offer

25%

Off

Get Premium IIA-CFSA Questions as Interactive Web-Based Practice Test or PDF

Contribute your Thoughts:

Submit Cancel

Micah

10 days ago

I believe the correct answer is A) I and II only, as those are the components that make up the combined ratio.

upvoted 0 times

...

Cassie

10 days ago

The combined ratio is like a financial Voltron – you only need the loss and expense ratios to form the ultimate insurance metric. B is the answer, no doubt about it.

upvoted 0 times

...

Isabelle

12 days ago

I agree with Carmelina, the expense ratio and IBNR are not included in the combined ratio.

upvoted 0 times

...

Teri

16 days ago

If you included IBNR, you'd be double-counting expenses. The combined ratio is just the loss ratio and expense ratio. B all the way!

upvoted 0 times

...

Ruby

17 days ago

IBNR stands for 'Incurred But Not Reported,' which is a liability, not a ratio, so it doesn't belong in the combined ratio. B is the correct answer.

upvoted 0 times

...

Carmelina

18 days ago

I think the combined ratio includes the loss ratio and other underwriting expense ratio.

upvoted 0 times

...

Belen

20 days ago

The 'combined ratio' is the sum of the loss ratio and the expense ratio, so I'd go with B. I and II only.

upvoted 0 times

...

Chau

21 days ago

I'm not sure, but I think the combined ratio also includes the expense ratio and IBNR.

upvoted 0 times

...

Aja

23 days ago

I agree with Carlene, the combined ratio is calculated by combining the loss ratio and other underwriting expense ratio.

upvoted 0 times

...

Carlene

26 days ago

I think the combined ratio includes the loss ratio and other underwriting expense ratio.

upvoted 0 times

...