All of the Following Statements About Regulatory Objectives of Insurance

question 36

Multiple Choice

All of the following statements about regulatory objectives of insurance rate making are true EXCEPT

• A)One purpose of rate adequacy is to maintain the solvency of insurers.
• B)Rates unfairly discriminate if loss exposures that are similar with respect to losses and expenses are charged substantially different rates.
• C)Insurers know in advance if the coverages marketed will be profitable,so rate regulation is not needed.
• D)Rates are excessive if policyholders are paying substantially more than the actual value of their protection.