Alberta General Insurance Level 1 Practice Exam

Retention in insurance terms refers to the specific amount of liability that an insurance company retains for claims that arise within a certain period of time. This excludes any claims that are passed on to a reinsurer. Options A, C, and D do not accurately represent the concept of retention and are therefore incorrect. Customer loyalty programs are strategies to retain customers, not related to insurance terms. Document storage protocols refer to how records are stored, not related to liability. The term of the insurance contract refers to the length of time the insurance policy is in effect, not related to the amount of liability retained by the ceding company.