Question

What is the benefit of deferment or postponement of risk for the insurer?

a.

It allows the insurer to charge extra premiums.

b.

It allows the insurer to avoid adding very high risks to the portfolio.

c.

It allows the insurer to cover all risks.

d.

It allows the insurer to accept all applicants.

Posted under IC22 Life Insurance Underwriting

Answer: (b).It allows the insurer to avoid adding very high risks to the portfolio. Explanation:Deferment or postponement of risk allows the insurer to avoid adding very high risks to the portfolio, thus helping to maintain a balanced risk profile.

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