Important Points for IC 26 - Life Insurance Finance Exam
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Vertical analysis data can be presented in the form of a pie chart.
Long term solvency means the ability of the company to survive for many years.
The prefered CR ratio must be near 100% and RER should be 15%.
Cash flow statement is useful internally to management to assess the liquidity of the business and externally to investors to generate positive cash flows in future to pay its liabilities.
The Total Figure in the statement is considered equal to 100% and then each factor of percentage is compared with the total; this is called a Common Size Statement.
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