Question

What is the primary purpose of options offered in insurance contracts?

a.

To increase the premium amount

b.

To limit the coverage period

c.

To convert the existing policy into a different type or alter its terms

d.

To decrease the benefits provided

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (c).To convert the existing policy into a different type or alter its terms Explanation:Options in insurance contracts provide policyholders with the flexibility to convert their existing policy into a different type or alter its terms according to their changing needs.

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Q. What is the primary purpose of options offered in insurance contracts?
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