Question

What factors do insurers consider when determining the minimum and optimum size of a policy?

a.

The expected financial strain from new business and expected profit

b.

The availability of similar products and the competency of distribution channels

c.

The age and income profile of people and competitors' rates

d.

All of the above

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (d).All of the above Explanation:Insurers consider various factors including the expected financial strain from new business, expected profit, competitors' rates, availability of similar products, the age and income profile of people, and the competency of distribution channels when determining the minimum and optimum size of a policy.

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Q. What factors do insurers consider when determining the minimum and optimum size of a policy?
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