Question

    A non-life insurer has a motor insurance portfolio

    showing increasing loss ratios for three consecutive quarters, rising from 72% to 91%. What internal risk control measures should the insurer prioritize to mitigate credit and underwriting risk?
    A Cancel existing policies Correct Answer Incorrect Answer
    B Reduce sum insured Correct Answer Incorrect Answer
    C Reassess underwriting norms and increase premium Correct Answer Incorrect Answer
    D Avoid reinsurance Correct Answer Incorrect Answer
    E Shift focus to investment income Correct Answer Incorrect Answer

    Solution

    Repricing and reassessing underwriting norms are vital in controlling credit and claim risks.

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