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Unformatted text preview: Materials for Study, 2009 Exam 5 2008, Casualty Actuarial Society, All Rights Reserved E5-1 Exam 5 Introduction to Property and Casualty Insurance and Ratemaking Before commencing study for this four-hour examination, candidates should read the Introduction to Materials for Study for important information about learning objectives, knowledge statements, readings, and the range of weights. Items marked with a bold SK constitute the 2010 CAS Exam 5 Study Kit that may be purchased from the CAS Online Store. Items marked with a bold OP (Online Publication) or W the 2010 CAS Exam 5 Web Notesare available at no charge in the Study Tools section of the CAS Web Site or may be purchased from the CAS Online Store. Please check the Syllabus Updates section of the CAS Web Site for any changes to the Syllabus . The CAS will test the candidates knowledge of topics that are presented in the learning objectives. Thus, the candidate should expect that each exam will cover a large proportion of the learning objectives and associated knowledge statements and syllabus readings, and that all of these will be tested at least once over the course of a few yearsbut each one may not be covered on a particular exam. A. Introduction to Property and Casualty Insurance Range of weight for Section A: 15-20 percent This section develops skills in reading and interpreting the policies that candidates will be pricing or for which they will be developing reserves. The policies covered in the readings should be viewed as representative illustrations of broad categories of property and casualty policies. Candidates will be expected to understand the various parts of the policies, as well as be familiar with typical policy provisions, such as coverages, conditions, exclusions, limitations, duties, etc. For purposes of this section, each of the following objectives refer to the following lines of business: Personal lines (auto, home) Commercial (auto, property, general liability, workers compensation, umbrella) LEARNING OBJECTIVES KNOWLEDGE STATEMENTS 1. Explain the insurance mechanism and its use as a risk management tool. Range of weight: 0-5 percent a. Loss exposure b. Risk elements c. Perils and hazards d. Elements of pooling vs. insurance e. Risk characteristics of insurable risks READINGS Nyce Foundations Materials for Study, 2010 Exam 5 E5-2 LEARNING OBJECTIVES KNOWLEDGE STATEMENTS 2. Explain the basic purpose and structure of the insurance contract, including coverages, exclusions, exceptions, limits, and deductibles. Range of weight: 9-13 percent a. Possible exposure to loss: Individual Company First party Third party (legal liability and triggers; state mandated) Perils covered b. Lines of insurance that cover each of the exposures to loss c. Basic insurance terminology (e.g., premium, loss, loss adjustment expense) d. Basic policy structure e. Basic policy terminology (e.g., named insured, declarations) READINGS...
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