2017.Fall 17 c.
Could the substantially all rule apply here as well? My reasoning is that 100% of the ceded portion of the contract has been transferred. Is that correct?
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Could the substantially all rule apply here as well? My reasoning is that 100% of the ceded portion of the contract has been transferred. Is that correct?
Comments
Yes, but for a 0.75 mark question generally you would like to do something in the realm of: Yes (0.25), Because (0.5).
Your answer is more like: Yes (0.25), Because (0.25)
if I include there are also no risk limiting features in the ceded portion of the contract, would that cover the remaining 0.25?
Yup I would think so
Why isn't a deductible considered a risk limiting feature? Naturally, it seems like one in this case as 2/3 scenarios will have nothing ceded because of this feature.
I think the sample answer makes it quite clear. For example, there is a > 10% chance to make a 10% loss. It does not matter if 2/3 scenarios will have nothing ceded