Alberta General Insurance Level 1 Practice Exam 2025 – 400 Free Practice Questions to Pass the Exam

Question: 1 / 400

What determines underwriting profit?

The difference between incurred claims and earned premiums

The amount by which earned premiums exceed incurred claims and expenses

Underwriting profit is determined by the amount by which earned premiums exceed incurred claims and expenses. This means that the insurance company is making more money from premiums than they are paying out in claims and expenses. Options A, C, and D are incorrect because they do not take into consideration all of the factors that contribute to underwriting profit. Option A only looks at the difference between two factors, while option C only considers one factor. Option D does not mention any expenses or claims at all. Thus, option B is the most accurate and complete explanation for what determines underwriting profit.

Get further explanation with Examzify DeepDiveBeta

The total of earned premiums

The investment income generated by the insurer

Next Question

Report this question

Subscribe

Get the latest from Examzify

You can unsubscribe at any time. Read our privacy policy