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Exam STAM (Short-Term Actuarial Mathematics)
#Question
A homeowner's insurance company notices increasing claims related to theft. What strategy should they implement?
A.
Limit coverage options
B.
Disregard the trend
C.
Increase premiums universally
D.
Provide theft prevention resources
Correct Answer:
D
Providing theft prevention resources to policyholders can help reduce claims as it empowers them to take proactive steps to safeguard their property.
#Question
A life insurance company finds an increase in claims related to terminal illnesses. What should they assess?
A.
Industry trends
B.
Policyholder demographics
C.
Underwriting criteria
D.
Marketing effectiveness
Correct Answer:
C
Assessing underwriting criteria can help identify and address potential shortcomings in risk assessment related to terminal illnesses.
#Question
An actuary evaluates the financial sustainability of an insurance portfolio. What key metric should they focus on?
A.
Customer demographics
B.
Marketing expenses
C.
Competitor profitability
D.
Loss ratio
Correct Answer:
D
The loss ratio is critical for evaluating the financial sustainability of an insurance portfolio, as it directly reflects profitability.
#Question
A health insurer examines claims data and finds a high rate of repeat hospitalizations. What should be their immediate action?
A.
Increase copayments for admissions
B.
Expand provider networks
C.
Offer preventative health services
D.
Improve communication with hospitals
Correct Answer:
C
Offering preventative health services can help reduce the occurrence of repeat hospitalizations by addressing health issues proactively.
#Question
Following the implementation of a mandatory diversity initiative, what is a significant benefit for an insurance company?
A.
Poor customer engagement
B.
Increased market share
C.
Decreased profit margins
D.
Limited talent pool
Correct Answer:
B
A mandatory diversity initiative can lead to increased market share by appealing to a broader customer base and understanding diverse needs better.
#Question
An actuary is tasked with creating a pricing model for a new insurance product. What is the first step in this process?
A.
Develop marketing strategies
B.
Analyze competitors' pricing
C.
Set profit margins
D.
Collect relevant data
Correct Answer:
D
The first step in creating a pricing model is to collect relevant data to inform accurate risk assessments and pricing strategies.
#Question
A company is seeing increasing claims from customers with chronic illnesses. What proactive step should they implement?
A.
Limit new enrollments
B.
Raise premiums across the board
C.
Offer disease management programs
D.
Reduce coverage options
Correct Answer:
C
Offering disease management programs can help improve health outcomes and potentially lower claims from chronic illness.
Exam STAM (Short-Term Actuarial Mathematics)
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