Which of the following statements is true about an insurance firm?
A)The reserves for insurance products are computed by underwriters.
B)Actuaries use mortality tables and life expectancy tables to estimate the future losses that the insurer must pay.
C)Morality tables show the length of life expected for people born in each year.
D)Life expectancy tables indicate the percent of expected deaths for each age group.
E)Underwriters specialize in forecasting the losses and developing the losses' potential future impact on the insurers.

Question

Quizplus · Accepted Answer

Actuaries are professionals who apply mathematical and statistical methods to assess risk in the insurance and finance industries. They use mortality tables, which show the death rates for specific age groups, and life expectancy tables, which indicate the average number of years remaining at a given age, to estimate future liabilities and ensure that an insurance firm has sufficient reserves to cover potential future claims.

Which of the Following Statements Is True About an Insurance