Which of the insurance lines listed below will be charged a higher premium by insurance companies and

Question:

Which of the insurance lines listed below will be charged a higher premium by insurance companies and why?
a. Low-severity, high-frequency lines versus high-severity, low-frequency lines.
b. Long-tail versus short- tail lines.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For book-img-for-question

Financial Markets and Institutions

ISBN: 978-0077861667

6th edition

Authors: Anthony Saunders, Marcia Cornett

See More Books

Question Posted: Jan 27, 2015 08:41 AM

See More Questions

Should national advertisers be charged a higher rate than local advertisers? Support your position.
Insurance companies will charge a higher premium for which of the insurance lines listed below? Why?
Why is a high risk premium is an advantage for the investor? Why is a low risk premium an advantage for the investor?
Analyzing Revenues and Expenses and Completing an Income Statement Neighborhood Realty, Incorporated, has been operating for three years and is owned by three investors. S. Bhojraj owns 60 percent of...
According to the college registrars office, 40% of students enrolled in an introductory statistics class this semester are freshmen, 25% are sophomores, 15% are juniors, and 20% are seniors. You want...
ROI and economic value added computations. A bank considers acquiring new computer equipment. The computer will cost $160,000 and result in a cash savings of $70,000 per year (excluding depreciation)...
C2.2. Dividends are the onlywayto paycashout to shareholders. Trueor False?
Eminence Corporation makes rocking chairs. The chairs move through two departments during production. Lumber is cut into chair parts in the cutting department, which transfers the parts to the...
Question 12 10 pts In significant detail, what connection is there between the "over/under applied overhead" (from Chapter 4 theory) and the "net overhead variances" (from Chapter 8 theory)? - 10...
Near the conduction band minima the energy can be expressed as 2(,+ k? k? + E 2 m: m; m In Si there are six cigar-shaped minima along [100]. If the ratio of the axes of constant energy ellipsoid is...
How do increases in unexpected inflation affect P&C insurers?
Contrast the balance sheet of a propertycasualty insurance company with the balance sheet of a commercial bank. Explain the balance sheet differences in terms of the differences in the primary...
Can stars be seen from the Moon's surface in the "daytime" when the Sun is shining?
Notation Using the weights (Ib) and highway fuel consumption amounts (mi/gal) of the 48 cars listed in Data Set 35 "Car Data" of Appendix B, we get this regression equation: = 58.9 - 0.00749x, where...
Week 11-Final Exam: Chapters 5-7 Question 15 of 30 -135 Current At in Ppm 06-20 10%.onthe 1110077 OORE Textbook and M DOLL F T 19 19 Q w A R T Y 3 . 9 4 S D 4 G H A L x N M Cu T
We have two samples: sample 1 n= 39 -X= 98.2 S= 15.9 sample 2 n=31 -X=119.2 S= 23.0 begin testing whether u1
Discuss charitable purpose trusts under Section 3(1), Charities Act 2011.
Amadeus Corporation is considering the issue of a new product to be added to its product mix. They hired you, a recent business graduate from MacEwan, for conducting the analysis. The production line...
Crocs designs, develops, and manufactures consumer products from specialty resins. The company's primary product line is Crocs-branded footwear for men, women, and children. It sells its products...
What are the before image (BFIM) and after image (AFIM) of a data item? What is the difference between in-place updating and shadowing, with respect to their handling of BFIM and AFIM?
For the salaries paid to the 817 professional baseball players in a recent year, the first quartile is $$4,355,101.$ What do we mean when we say that $$4,355,101$ is the first quartile?
How are banks' balance sheet decisions regulated?
Describe highly leveraged transactions (HLTs), and explain why a bank's exposure to HLTs is closely monitored by regulators.
Explain the "moral hazard" problem as it relates to deposit insurance.
you are analyzing the cost of debt for a firm. Do you know that the firms 14 year maturity, 7.8 Percent coupon bonds are selling at a price of $834. The Barnes pay interest semi annually. If these...
***Please answer the following using excel and showcasing the formulas/calculations used*** thank you so much Financial information on AAA Ltd. is shown below. AAA Ltd. Income Statement For the Year...
2. In an account Anh Paglinawan currently has $216,670.00. At a rate of 8.00% how long will it take for them to have $298,390.00 assuming semi-annually compounding? (Hint: compute the exact years, do...

Which of the insurance lines listed below will be charged a higher premium by insurance companies and

Question:

Step by Step Answer:

a b Insurance companies have a more difficult time predicting the severity o...View the full answer

Financial Markets and Institutions

Students also viewed these Banking questions