Question

How are expenses typically measured in insurance business transactions?

a.

As a proportion of sum assured

b.

As a fixed amount per policy

c.

As a percentage of investment income

d.

As a percentage of premium for a certain unit of time

Answer: (d).As a percentage of premium for a certain unit of time Explanation:In insurance business transactions, expenses are commonly measured as a percentage of premium for a specific period, such as annually or monthly. This approach allows insurers to allocate expenses relative to the amount of premium collected, providing a standardized method for expense management and pricing decisions.

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Q. How are expenses typically measured in insurance business transactions?

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