College of Administrative and Financial Sciences Assignment 2 Deadline: (End of Week 9) 20/3/2021@ 23:59 Course Name: Insurance Accounting Student’s Name: Course Code: ACCT 424 Student’s ID Number: Semester: 2 CRN: Academic Year: 1440/1441 H For Instructor’s Use only Instructor’s Name: Students’ Grade: Marks Obtained/Out of 5 Level of Marks: High/Middle/Low Instructions – PLEASE READ THEM CAREFULLY • The Assignment must be submitted on Blackboard (WORD format only) via allocated folder. • Assignments submitted through email will not be accepted. • Students are advised to make their work clear and well presented, marks may be reduced for poor presentation. This includes filling your information on the cover page. • Students must mention question number clearly in their answer. • Late submission will NOT be accepted. • Avoid plagiarism, the work should be in your own words, copying from students or other resources without proper referencing will result in ZERO marks. No exceptions. • All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism). • Submissions without this cover page will NOT be accepted. 1 Assignment Question(s): Q1. Read the following features related with types of reinsurances and identify the correct type of reinsurance: (1 Marks) a) This type of reinsurance is also termed as stop loss reinsurance. b) In this type agreement, the policyholder is unaware about any indemnity reinsurance transactions pertaining to original contract. c) This type of reinsurance is related with either retaining all claims up to a particular and stated amount by the insurer or retaining each risk. d) In this type of insurance, the policyholder is required to provide the necessary consent to releasing the ceding company. Q2. Structures of insurance companies’ financial statements (income statement, balance sheet, cash flow statements) vary than structures the non- insurance organization due to the unique features of the insurance companies. Give a sample of the structures for any selected Saudi insurance company’ financial statements and explain the rational for classifying balance sheet accounts. Write no less than 300 words (2marks) Q3. Explain how three of the following elements can affect estimate of loss reserve. (2 marks) ✓ The claims-handling process ✓ Policy and exposure forms ✓ Inflation ✓ Legal trends ✓ Environmental factors ✓ Mix of claimants ✓ Timeliness of claim reporting by claimants 2
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