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PRM Certification – Exam IV: Case Studies; Standards: Governances: 110 (8004) - PRMIA Exam Questions

Last updated on June 20, 2026

97% Exam Compliance
110 Total Questions
1
Question
The Fortress Re finite reinsurance model
Options
A allowed Fortress to claim re-insurance claims payments from the finite reinsurers and paid premiums to cover these deals over a 5 year period, but as the risks were spread out over time the future premiums were not accounted for as current liabilities on the books of the pool members,
thus giving a false impression of profitability
B allowed Fortress to claim re-insurance claims payments from the finite reinsurers and paid premiums to cover these deals over a 5 year period, and as the risks were spread out over time the annual premiums were accounted for as current liabilities on the books of the pool members, giving a true impression of profitability
C allowed Fortress to claim re-insurance claims payments from the finite reinsurers and paid annual premiums to cover these policies, and as the risks were spread out over the year the annual premiums were accounted for as current liabilities on the books of the pool members, giving a true impression of profitability
D allowed Fortress to claim re-insurance claims payments from the finite reinsurers and paid premiums to cover these deals over a 5 year period, and as the risks were spread out over time the future premiums were accounted for as current liabilities on the books of the pool members, giving a true impression of profitability
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2
Question
Several clients, including Procter and Gamble took legal action against Bankers Trust, claiming Bankers Trust
Options
A hid profits
B sold them derivative products without properly advising them of the relevant risks
C did not honour its contractual obligations to pay
D was involved in accounting fraud
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3
Question
John Smith wants to run for election to the Board of Directors of PRMI
Options
A The backing of 6% of local members
B To go through a screening process conducted by the Nominations Committee
C The backing of three other members
D The backing of five other members and to be serving on at least one PRMIA Committee
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4
Question
Employees shall be remunerated adequately for the roles that they perform, where 'adequately' is defined
Options
A using the risk reward profile for each business line in the organization
B using external references and benchmarks, and in a framework which is consistent with the type of risk-taking behavior expected of employees
C as commensurate with policies to attract and retain high income / revenue earners
D as being the market norm for similarly situated personnel in competitive organizations
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5
Question
According to PRMIA governance principles, boards and audit committees should …
Options
A Be composed of key business unit representatives
B Collectively assume responsibility of understanding and reporting the effectiveness of the firm risk management infrastructure
C Leave shareholder accountability to senior management who decides strategic direction
D Review compensation plans to ensure consistency with corporate risk appetite, competitive market conditions, and fiduciary responsibility to shareholders
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