SOFE AFE Exam - Topic 2 Question 85 Discussion

Actual exam question for SOFE's AFE exam

Question #: 85
Topic #: 2

In which premium income less return premiums arising from policies issued by the entity collecting the premiums and acting as the primary insurance carrier?

AIndirect premium

BDirect premium

CReinsurance premium

DEntity premium

Show Suggested Answer

Suggested Answer: C

by Janey at Sep 16, 2024, 08:54 AM

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Angella

7 months ago

Just to clarify, return premiums are deducted from the total.

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Marguerita

7 months ago

Totally agree, it’s definitely direct premium!

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Sheldon

7 months ago

Wait, is this really how it’s defined? Sounds off.

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Steffanie

7 months ago

I thought reinsurance premium was the answer.

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Delsie

8 months ago

Direct premium is the right term here.

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Luis

8 months ago

I thought "entity premium" was a term we covered, but it doesn't seem to fit the definition given in the question.

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Gabriele

8 months ago

I feel like "reinsurance premium" is related to premiums paid to other insurers, but I'm not confident about that.

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Lenny

8 months ago

I remember practicing a similar question where we had to differentiate between direct and indirect premiums. I think direct premium might be the right choice here.

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Ariel

9 months ago

I think this question is about the types of premiums, but I'm not entirely sure what "indirect" means in this context.

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Leanna

9 months ago

I'm confused by the wording of this question. Can someone explain what they mean by "premium income less return premiums"?

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Salena

9 months ago

Okay, let me see. The key is understanding the difference between direct and indirect premium. I've got a strategy for figuring this out.

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Marvel

9 months ago

Hmm, I'm a bit unsure about this one. I'll need to think it through carefully.

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Carlota

9 months ago

This question seems straightforward, I think the answer is B. Direct premium.

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Alonso

1 year ago

I'm already imagining the insurance humor in this exam. 'What do you call a group of insurance agents? A risk pool!'

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Johnathon

1 year ago

C) Reinsurance premium

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Carman

1 year ago

B) Direct premium

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Felicitas

1 year ago

A) Indirect premium

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Renato

1 year ago

D) Entity premium? Sounds like a made-up option to me. I'm sticking with B).

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Dong

1 year ago

C) Reinsurance premium

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Jolanda

1 year ago

B) Direct premium

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Nickie

1 year ago

A) Indirect premium

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Devorah

1 year ago

Direct premium, obviously! What kind of insurance exam is this, anyway?

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Tawanna

1 year ago

Hmm, not quite. It's direct premium.

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Jeffrey

1 year ago

Indirect premium

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Deeanna

1 year ago

No, it's actually direct premium.

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Mozell

1 year ago

Reinsurance premium

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Elden

1 year ago

That's correct!

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Daryl

1 year ago

Direct premium

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Phuong

1 year ago

I'm not sure, but C) Reinsurance premium also sounds plausible to me.

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Samira

1 year ago

I agree with Izetta, because the entity is collecting the premiums directly.

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Kimbery

1 year ago

Hmm, this one's got me stumped. I'll have to go with my gut and say C) Reinsurance premium.

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Juliann

1 year ago

I would go with C) Reinsurance premium.

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Ernest

1 year ago

I think it's B) Direct premium.

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Izetta

1 year ago

I think the answer is B) Direct premium.

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Justine

1 year ago

This question is a bit tricky, but I'm fairly certain the answer is B) Direct premium.

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Zachary

1 year ago

I'm not sure, but I think it could also be C) Reinsurance premium, as the entity may pass on some of the risk to another insurer.

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Sabina

1 year ago

I agree with Keva, because the entity is collecting the premiums directly.

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Keva

1 year ago

I think the answer is B) Direct premium.

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