Question

How are expenses handled in the calculation of gross premium for group insurance?

a.

Expenses are not considered in the calculation

b.

Expenses are fixed and do not vary with group size

c.

Expenses vary depending on the size and specific needs of each group

d.

Expenses are amortized over a number of years

Posted under IC 92 Actuarial Aspects of Product Development

Answer: (c).Expenses vary depending on the size and specific needs of each group Explanation:Expenses in the calculation of gross premium for group insurance vary depending on the size and specific needs of each group. They may include various costs such as actuarial support, accounting, underwriting, claims investigations, and marketing, among others.

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Q. How are expenses handled in the calculation of gross premium for group insurance?
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