M93 - Mop up

Question 1

How calculate burn ratio

Answer 1

Take 3 year average (ideally five)
X 100
Divide by expenses remainder of 100 EG 35% expenses = divide by 65
+ inflation %

Question 2

Aggregate deductable.

Answer 2

Insured was ‘working excess’ of £1000
Insured selects max deductible as 20k per claim, max aggregate 100k

This means any claim below 1k - No payment.
Any claim above 1k but below 20k, no payment, but does count towards aggregate
Any claim over 20k the insurer pays the balance, counts towards aggregate
Once 100k limit is reached, insurers pays the claim, less £1000 excess.

Question 3

What does a hard market drive

Answer 3

Increased insurance and re-insurance premiums

Low commission

Question 4

What gives the largest fire discount?

Answer 4

Sprinklers

Question 5

Before T&Cs what two factors will insurer base premium on for property insurance?

Answer 5

Prior loss experience

Efficiency of management procedures

Question 6

How is normal loss expectancy calculated?

Answer 6

Excludes catastrophe claims, and assumes all management processes function correctly.

Question 7

It what circumstance can the insured insist a claim is paid in cash?

Answer 7

It can’t, In the insurer may have the option within the policy terms for re-instatement.

Question 8

For a valued section of a policy, when is the SI established?

Answer 8

Outset of the policy