Adjustments to the deposit related to the unexpired portion of the coverage are recorded as an adjustment to incurred losses.
Answer(s): A
Under SAP, reserves for losses and loss adjustment expenses and unearned premiums ceded to reinsurers are reported as annual disable losses of the related reserves.
Answer(s): B
GAAP requires that all declared policyholder dividends be accrued at the balance sheet date, using actual amount to be paid.
Under SAP, contingent commissions are accrued over the same period in which the related underwriting results are recognized.
SAP, an insurance company is given an option of recognizing salvage and subrogation upon receipt or accruing the estimated amount of salvage and subrogation related to ultimate claim costs by reducing the related reserves.
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