As a Result of Frequent Flooding, the Insurance Market Has

question 66

Multiple Choice

As a result of frequent flooding, the insurance market has noted a positive correlation between flooding and the amount of insurance monies paid out for such floods.Holding demand for insurance constant, if flooding is expected to continue to be a problem:

• A)flood insurance providers will reap greater profits.
• B)there will be an increase in the number of insurance companies wishing to provide such insurance.
• C)flood insurance markets may eventually collapse, since the risks of damage cannot be offset through diversification.
• D)flood insurance markets will experience a decrease in the price of premiums.

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