PART $1.$ TRUE OR FALSE $(1**10=10$ Marks$)$

Direction: Read the statements carefully and identify whether the statement is TRUE or FALSE.

Actuary is a delegated person selected by the company to estimate the price rating for the Insurance.

Maximize the need for reserve holdings is one of the liquidity planning steps

A Lack of liquidity can cause a firm to fail even when it is technically solvent

Treaty reinsurance means the primary insurer has agreed to cede all insurances to the reinsurer

Reinsurance is used to decrease underwriting capacity

Liquidity risk is the possibility of not meeting the short$-$term debt obligations

Difficulty finding necessary funding on the credit market or on financial markets is one of the reasons that causes liquidity risk

The CEO of the company is always designated to manage the liquidity risk

A statement of underwriting policy establishes policies that are consistent with the company's objectives

MIB Reports are used to detect the health history of the insured for the past $3$ to $5$ years.