How long must copies of every memorandum or contract be retained?

The correct answer is three years. This duration aligns with regulatory requirements for maintaining various records in the insurance industry, including memoranda and contracts. Retaining these documents for three years ensures compliance with legal standards and allows for adequate time to address any disputes or inquiries that may arise related to the contracts.

Having this retention period is crucial for both the insurer and policyholders, as it enables the relevant parties to review agreements and decisions made during that time. Additionally, it provides a safeguard against any potential claims, ensuring that documentation is available for reference if necessary.

Records kept longer than three years may not be needed for most regulatory purposes, while a shorter retention period could result in the loss of important information that may be needed for policy disputes or audits. This balance is fundamental for effective management in the insurance field.