Question 1
For a Pareto distribution with parameters α and λ, which property makes it a popular model for large insurance losses?
Correct Answer:
It has a heavy (slowly decaying) tail, capturing the chance of very large claims
Question 2
Under proportional reinsurance with retention proportion a (0 < a < 1), if the gross claim is X, what amount does the insurer retain?
Correct Answer:
aX
Question 3
Under excess-of-loss reinsurance with retention M, the reinsurer pays Z = max(X - M, 0). If individual claims X are exponential with mean 1/λ, what is the probability that the reinsurer is involved in a given claim?
Correct Answer:
e^{-λM}
Question 4
In the collective risk model, aggregate claims S = X1 + ... + XN where N is the claim number and Xi are i.i.d. claim sizes independent of N. Which formula gives E[S]?
Correct Answer:
E[N] × E[X]
Question 5
For a compound Poisson aggregate-claims distribution S with Poisson parameter λ and claim sizes X, which expression gives Var(S)?
Correct Answer:
λ E[X^2]
Question 1
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Prepare with the IFoA CS2 Practice Questions - IFoA CS2 Risk Modelling and Survival Analysis Exam practice quiz. This question bank includes 100 questions covering markov, model, mortality, distribution, and claim. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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IFoA CS2 Practice Questions - IFoA CS2 Risk Modelling and Survival Analysis Exam

This practice set contains 100 questions from the matching question bank and focuses on markov, model, mortality, distribution, and claim. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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