The Number of Title Insurance Companies Operating in State Z

question 33

Multiple Choice

The number of title insurance companies operating in State Z is relatively low.Recently,the largest of these companies (50 percent market share) acquired the second largest company (30 percent market share) .Immediately after the acquisition,the insurer raised premiums by 75 percent.This scenario demonstrates which of the following rationales for the regulation of insurance?

• A)maintain insurer solvency
• B)prohibit unfair sales practices by agents
• C)ensure reasonable rates
• D)make insurance available

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Definitions:

Franchisors

Entities or individuals that grant the right to operate a business under their trademark or brand to another party, known as a franchisee.

Unlimited Life

Refers to entities, typically corporations, that are structured to continue operations indefinitely unless dissolved.

Ease of Formation

The simplicity and straightforwardness associated with establishing a new enterprise or legal entity, typically influenced by the regulatory and legal environment.