Insurance companies invest in many areas, but most of all they invest in bonds. This makes sense because bonds are perhaps the safest of all investment categories. Insurance companies being in the business of risk assessment would logically find the low risk that bonds represent appealing, but there are other reasons as well. (1.5 Marks)

Questions:

a. How Insurance Companies Make Money?

b. Why Insurance Companies Invest?

c. What Insurance Companies Invest In?