CAA Study Guide 2026
Everything you need to pass the CAA exam in one place: the exam format, every topic to study, real practice questions with explanations, flashcards, and full-length practice tests. Free, no sign-up needed.
📋 CAA Exam Format at a Glance
📚 CAA Topics to Study (17)
✍️ Sample CAA Questions & Answers
1. Which of the following best describes 'opportunity cost'?
Opportunity cost is the value of the best alternative you give up when making a choice, capturing the true economic cost of any decision.
2. What does the time value of money principle state?
The time value of money principle states that a dollar today is worth more than a dollar in the future due to its potential earning capacity.
3. Which US regulatory framework requires life insurers to hold minimum reserves for individual life policies?
US life insurers must hold statutory reserves under NAIC model laws, which apply Statutory Accounting Principles designed to ensure policyholder protection and solvency.
4. The Weighted Average Cost of Capital (WACC) represents:
WACC blends the costs of debt and equity, each weighted by their respective share of total capital, and represents the minimum return a firm must earn to satisfy all its capital providers.
5. What does 'peer review' mean in the context of actuarial work?
Peer review in actuarial practice is an independent examination by another qualified actuary to verify the appropriateness of methods, assumptions, and numerical results.
6. What is the primary actuarial concern with 'guaranteed issue' health insurance products that do not use medical underwriting?
Without medical underwriting, guaranteed issue products attract a higher proportion of unhealthy applicants, leading to adverse selection and a claims experience worse than the general population average.