Question

In what situations might insurers use deductibles as a risk management strategy?

a.

To reduce their own expenses

b.

To discourage policyholders from filing claims

c.

To prevent the accumulation of small claims

d.

To avoid processing small claims

Posted under IC38 Life Insurance Agent Exam

Answer: (c).To prevent the accumulation of small claims Explanation:Insurers may use deductibles as a risk management strategy to prevent the accumulation of numerous small claims, especially in situations where multiple small losses might occur at one location, causing financial stress to the insurer.

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Q. In what situations might insurers use deductibles as a risk management strategy?
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