Question

Which of the following insurance contracts is likely to have a significant insurance risk component?

A Warranty contract Correct Answer Incorrect Answer
B Reinsurance contract Correct Answer Incorrect Answer
C Catastrophe bond Correct Answer Incorrect Answer
D Investment contract Correct Answer Incorrect Answer
E Lease contract Correct Answer Incorrect Answer

Solution

Explanation: Catastrophe bonds are issued by insurance or reinsurance companies to transfer specific catastrophe-related risks to investors. These contracts typically have a significant insurance risk component.

Practice Next
×
×