Question

Identify the two factors that affect insurance ratemaking.

a.

Probability and severity of risk

b.

Source and nature of risk

c.

Source and timing of risk

d.

Nature and impact of risk

Posted under IC38 Life Insurance Agent Exam

Answer: (a).Probability and severity of risk Explanation:In insurance ratemaking, the primary factors that affect the calculation of rates are the "probability" and "severity" of risk. These two factors are crucial in determining how much an insurance company should charge for coverage.

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Q. Identify the two factors that affect insurance ratemaking.
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