What involves analysis of the company's contact on an account-by-account (policyholder) basis?

Question

Options

• Arevelation approach
• Bexposure analysis approach
• Cspotlight analysis approach
• Dlimelight approach

• A
  6% (2)
• B
  80% (28)
• C
  3% (1)
• D
  11% (4)

Explanation

Exposure analysis approach (B) is correct because it is the established actuarial/reinsurance term for evaluating a company's risk by examining each individual policyholder account separately - assessing the specific characteristics, limits, and hazards of each contract rather than aggregating the portfolio. This granular, account-by-account review allows underwriters and actuaries to precisely measure how much risk ("exposure") exists at each insured.

Why the distractors are wrong: Options A, C, and D - revelation approach, spotlight analysis approach, and limelight approach - are fabricated terms with no recognized meaning in insurance or actuarial practice. They are designed to sound plausible but don't correspond to any standard methodology.

Memory tip: Think of "exposure" as the insurer's vulnerability on each policy. The exposure analysis approach zooms in on that vulnerability policy-by-policy, like inspecting each link in a chain individually. If you remember that "exposure" = individual risk measurement, you can rule out any answer that doesn't use that word.

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