Canadian Accredited Insurance Broker (CAIB) Two Practice Exam

Which type of report may be used by underwriters to assess previous claims?

1. Inspection report

2. Financial report

3. Claims report

4. Management report

The correct answer is: Claims report

A claims report is specifically designed to provide detailed information about past insurance claims. This type of report includes data on the frequency, severity, and nature of claims made by a policyholder. Underwriters rely on claims reports to identify patterns or trends in a client’s claims history, which helps them evaluate risk and make informed decisions about policy issuance, coverage limits, and premiums. By analyzing previous claims, underwriters can assess the likelihood of future claims and determine appropriate risk management strategies. Inspection reports primarily focus on evaluating the condition or safety of a property or asset at the time of underwriting, while financial reports relate to the financial health of a business or individual but do not typically detail claims history. Management reports often provide high-level overviews and insights for decision-making but lack the specific claim-related data that underwriters need. Thus, the claims report is the most relevant document for assessing previous claims.