Q4
I found the question in part b to be a bit misleading. I answered it for reasons an insurance company would want an interactive rating vs a rating based on publicly available information (and no company input).
I was thinking if the question asked, "Why are agency ratings important to insurance companies?" it would more align with the answers in your solution.
Comments
The wording does trip you up a bit. Then again, if Best, Moody's, S&P all use interactive rating, that means all the rating that is worthwhile out there is interactive.
yes, but can't a company choose not to partake in the interactive part of the rating and received a public rating instead?
The public rating would inherently be a worse rating than an interactive one because the company would not be able to give additional data or clarifying comments to achieve a better rating.
I just came across the Battle Card that I was thinking of, it is in Feldblum.Ratings - it's from the previous CAS exam 2013.Fall #7b:
identify similarities & differences between 'interactive ratings' & 'public ratings'
I think your answer would be given credit.
The first answer I provided,
maybe should have been more precise. I really meant:
The old exam questions where they ask about this generally provide a wide range of acceptable answers. The answer in the practice exam just listed 3 according to the acronym "USE", but those 3 reasons are not necessarily exhaustive. Those are just 3 handy reasons that seem to be part of the examiners' reports answers for all the different times that question was asked.
this is an error on my end, sorry