4 Health and Life insurance multiple choice questions

All the following statements concerning the need for and the use of a life insurance company's surplus are correct, EXCEPT:

Question 19 options:

	1)  The financing of new business growth represents a typical young life company's most significant demand for capital.
	2)  If a stock company increases its dividends on its participating policies, its participating products become more price-competitive.
	3)  A liberal stockholder dividend policy may impair the company's contingency fund.
	4)  Given a choice, stockholders will inevitably vote for a liberal stockholder dividend policy.

Which of the following statements concerning the duration matching of its assets and liabilities by a life insurance company are correct? I. Asset duration is the average length of the asset's holding period. II. Liability duration is the average time period from policy insurance to claim payment. III. Duration matching means matching liability duration with asset duration. IV. Duration matching is really cash flow matching.

Question 20 options:

	1)  I and II only
	2)  II and III only
	3)  I, II, and III only
	4)  I, III, and IV only -*e. I, II, III, and IV

All of the following statements concerning the capital and surplus of a life insurance company are correct, EXCEPT:

Question 25 options:

	1)  They are needed to absorb unexpected fluctuations in death claims.
	2)  They are needed because while property-liability insurers may adjust premiums upward at each policy renewal date, life companies may not.
	3)  The NAIC's new capital standards are based exclusively on each individual company's mortality risk, but not on its investment risk.
	4)  Each state has minimum capital requirements that all life insurance companies must meet.

Which of the following statements concerning the need for and the supply of capital for a life insurance company is/are correct? I. The need for capital varies directly with the company's rate of growth. II. A life insurance company's primary sources of capital are extended.

Question 22 options:

	1)  I only
	2)  II only
	3)  Both I and II
	4)  Neither I nor II