Strategic Planning and Decision Making Flashcards
7 cards from real CAS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Strategic Planning and Decision Making flashcards as text
In a SWOT analysis for an insurance company, which of the following would be classified as an 'Opportunity'?
Answer: Emerging market for cyber liability insurance
An opportunity in SWOT analysis is an external favorable factor, such as a new product market, that the company can exploit for growth.
Which strategic planning framework uses four perspectives—financial, customer, internal processes, and learning & growth—to translate strategy into action?
Answer: Balanced Scorecard
The Balanced Scorecard, developed by Kaplan and Norton, aligns business activities to the vision and strategy of the organization using those four perspectives.
A property-casualty insurer is considering entering a new geographic market. Under the Ansoff Matrix, this strategy is best described as:
Answer: Market Development
Market Development involves selling existing products to new markets, such as geographic expansion, which fits entering a new region with existing coverage offerings.
Which decision-making model assumes that decision makers have complete information and will always select the option that maximizes utility?
Answer: Rational Choice Model
The Rational Choice Model assumes perfect information, clear preferences, and optimization, though in practice these conditions rarely hold.
An insurer's strategic plan identifies a goal to reduce expense ratio by 5 points over three years. This goal is best described as:
Answer: A strategic objective
A strategic objective is a specific, measurable goal that supports the organization's overall strategy and is typically set over a multi-year horizon.
When applying scenario planning in P&C insurance, which of the following best describes the purpose of 'wild card' scenarios?
Answer: To represent low-probability, high-impact events that could disrupt strategy
Wild card scenarios force strategic planners to consider extreme but plausible disruptions, improving organizational resilience and contingency preparedness.
A casualty actuary is asked to quantify the strategic risk of entering a new line of business. Which approach most directly supports this analysis?
Answer: Stochastic modeling of potential outcomes across multiple scenarios
Stochastic modeling generates a distribution of outcomes across scenarios, enabling quantification of uncertainty and strategic risk in new ventures.