A functional reinsurance is that it
-
protects the account of the insurer against large claims
- discourage the spread of risk in the insurance market
- provides protection for uninsured losses
- encourages the insured to make claims from more than one insurer
The correct answer is: A
Explanation
Reinsurance is also known as insurance for insurers or stop-loss insurance.Reinsurance is the practice whereby insurers transfer portions of their risk portfolios to other parties by some form of agreement to reduce the likelihood of paying a large obligation resulting from an insurance claim.