SOFA-CFE Exam Questions

Probable future economic benefits obtained or controlled by a particular entity as a result of past transactions or events is called:

What are recognized and accepted by state insurance departments in evaluating the solvency of an insurer for statutory accounting purposes?

What do not contribute to an insurer's solvency as measured by statutory accounting requirements?

_____________ is defined as an existing condition, situation, or set of circumstances involving uncertainty as to possible loss to an enterprise that will ultimately be resolved wh...

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

The amount the owner expects to receive when the bond matures is known as:

If the price is higher than par, the excess is the ____________; if the price is lower than par, the deficiency is the ____________.

The amount of the impairment is the difference between the net fair value (appraised) value less estimated costs to sell) of the collateral and the insurer's recorded investment in...

Any real estate which is owned by and more than 50 percent occupied (based on rentable square footage) by an insurer and its' affiliates is considered property occupied by the comp...

A market quote or an appraisal is used to determine what of property held for sale?

All investments with remaining maturities (or repurchase dates under repurchase agreements) of one year or less at the time of acquisition are called:

What represents balances due from brokers when a security has been sold, but the proceeds have not been received?

Balances due within thirty days of the settlement date are included as a receivable for securities.

When the insurer or the intermediary may prepare a monthly recapitulation of premium and commission transactions between the parties, commonly called:

What include balances due from the insurer's brokers (collectively referred to as agents' balances) for premium on policies written?

The asset classification of funds held by or deposited with reinsured companies occurs when:

Which payments reflect the amount of reinsurance recoverable from reinsurers based upon the amounts paid by the ceding company under reinsured policies?

Admissibility test must be applied to determine the amount of deferred tax asset (DTAs) that can be admitted is called:

Which software must be established as a non-admitted asset and written off over a period not to exceed the lesser of the useful life of the software or five years.

Income earned as of the reporting date but not legally due to be paid to the reporting entity until subsequent to the reporting date is known as:

What bears all of the insurance risk, and there is no possibility of loss or liability to the administrator caused by claims incurred related to the plan.

Material amounts must be capitalized and depreciated, and the un-depreciated amount must be reported as a non-admitted asset.

Loans on company's stock represent situations where the insurer lends money and accepts its own stock as collateral.

The concept of unearned premium is important to the business of insurance for which principal reason?

At any time during the policy period, the earned premium plus the unearned premium for a policy equals its:

The amounts charged the insureds (the policyholders) for insurance coverage are called:

What is not related to premiums paid to or received from another insurance company, either a company to whom reinsurance is ceded or a company from whom reinsurance is assumed?

Those premiums arising from policies that an insurer transfers, in part or in whole (as the ceding company or reinsured), to another insurance company are called:

____________________ are those premiums arising from policies which an insurer accepts, in part or in whole (as the reinsurer), from another insurance company.

Gross written premiums are:

Net written premiums are:

Which of the following is the correct formula to calculate the unearned premium?

Which of the following is the correct formula to calculate the earned premium?

Requiring the expense items relating to policy issuance to be expensed as a period cost at the time the policy is written is called:

Which of the following is Correct?

Which of the following premium payment plans are generally offered by mortgage guaranty insurers?

Premium which is earned as written is called monthly premium.

The premium which is earned over the contract period in relation to the expiration of risk is known as:

What is determined by the changing nature of the insurance protection provided over the contract period?

What requires the full-term premium for each policy that has not expired at the Annual Statement date be determined?

The in-force method requires the computation of which premium charges?

Under which method of calculating unearned premium reserves, the amortization procedure uses the written premiums for the full term of the policy, or for any additional premium pai...

Under audit-type policies, the actual amount of the in-force premium is not known at the inception of the policy.

What requires that the retrospective rated premiums reserve be calculated for each individual risk by applying the appropriate retrospective rating formula to each plan?

The projection method is not totally accurate in developing the unearned premium reserve, it provides the best estimate based on prior experience and adjusted for current activitie...

Which of the following is NOT the loss category?

Which of the following is the loss characteristic?

The reserve for a reported claim that is established by an adjuster or a formula based on the company's loss experience is called:

Which practices will vary based on company claim procedures, the line of business and size of claim.

The claims that have occurred prior to the company's balance sheet date, were not reported, and therefore are not recorded by the company are known as: