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b) Which of the following statements about underwriting standards is (are) true and explain why? I. One purpose of underwriting standards is to reduce adverse

b) Which of the following statements about underwriting standards is (are) true and explain why?

I. One purpose of underwriting standards is to reduce adverse selection against the insurer.

II. Equitable rates should be charged so that each group of policy owners pays its own way in terms of losses and expenses.

III. Insurance company must maintain sufficient investment income flows to cover the risk of negative insurance float.

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