SOFE SOFA-CFE Exam Questions Instant Access

Question 1

What may be determined as a percentage of the subject base premium, a flat rate, or a rate developed by the reinsured's loss experience?

AReinsurance income

BWritten premiums

CPremiums

DLoss reserving practices

Answer : C

Question 2

When the draft is received for acceptance from the bank, the liability that is debited and funds are transferred from the company's operating cash account to the bank is called:

Adraft payable

Bdraft receivable

Cinternal signature cards

Dtransferring debts

Answer : A

Question 3

What is the total amount of checks, wire transfers or drafts issued in settlement of claims for the risks insured by the company?

ATraditional settlements

BLosses paid

CSecured claims payment

DShort-tail claims payment

Answer : B

Question 4

Estimating the premiums needed to fund future promises is called:

AProspective funding

Bimminent procedure

Cratemaking

Dpotential funding

Answer : C

Question 5

Property-casualty insurance companies derive investment income from which of the following primary source?

Ainvestment of shareholder capital

Binvestment of policyholder funds

CBoth A and B

Dneither A nor B

Answer : C

Question 6

Any securities representing a creditor relationship, whereby there is a fixed schedule for one or more future payments are called:

AAdmitted assets

BPolicy imbursement

CYield amount

DBonds

Answer : D

Question 7

Which of the following is Correct?

AUnearned premiums are calculated by simply taking the sum of the assumed written for the period plus the unearned premium reserve (liability) at the beginning of the period less the unearned premium reserve at the end of the period.

BEarned premiums are calculated by simply taking the sum of the premiums written for the period plus the unearned premium reserve (liability) at the beginning of the period less the unearned premium reserve at the end of the period.

CEarned premiums are calculated by simply taking the sum of the premiums written for the period plus the earned premium reserve (liability) at the beginning of the period less the earned premium reserve at the end of the period.

DEarned premiums are calculated by simply taking the sum of the premiums written for the period plus the unearned premium reserve (liability) at the beginning of the period more than the earned premium reserve at the end of the period.

Answer : B

SOFE Certified Financial Examiner SOFA-CFE Exam Questions