Alberta General Insurance Level 1 Practice Exam

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Ace your Alberta General Insurance Level 1 Exam with our comprehensive practice quiz. Tailored to mimic the real test, our quiz offers detailed explanations, expert tips, and all you need to succeed. Start your path to becoming a licensed professional today!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

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What is a cession in reinsurance?

A legal dispute between insurers
The amount transferred through reinsurance
A type of policy cancellation
A regulatory compliance procedure

The correct answer is: The amount transferred through reinsurance

A cession in reinsurance is the amount of risk and liability that is transferred from one insurance company to another through a reinsurance agreement. This amount is usually calculated as a percentage of the premiums received by the primary insurer. Option A is incorrect because a cession is not a legal dispute, but a transfer of risk. Option C is incorrect because it refers to a policy cancellation, which is not directly related to reinsurance. Option D is incorrect because it refers to regulatory compliance, which is a different aspect of the insurance industry.