Question

How is the Premium Allocation Charge (PAC) calculated?

a.

It is a fixed amount for all premiums

b.

It is a percentage of the policyholder's age

c.

It varies based on premium year, size, frequency, and type

d.

It is determined by the insurer's profit margin

Posted under IC 14 Regulations of Insurance Business

Answer: (c).It varies based on premium year, size, frequency, and type Explanation:The Premium Allocation Charge (PAC) varies based on factors such as the premium year, size, frequency, and type. It is explicitly stated as a percentage of the premium received and can vary accordingly.

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Q. How is the Premium Allocation Charge (PAC) calculated?
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