In Order for Insurance Companies to Generate Predictable Payouts, They

question 21

Multiple Choice

In order for insurance companies to generate predictable payouts, they need to:

• A) spread the risk across many policies.
• B) accept policyholders from a very specific geographic area.
• C) focus on insuring only specific events, for example only fire.
• D) offer only life insurance.

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Definitions:

Dividends

Payments made by a corporation to its shareholders, usually as a distribution of profits.

Corporate Opportunity

A business opportunity that a company has a legal interest in or right to, which an officer or director cannot take for their personal gain without breaching their fiduciary duty.

Conglomerate

A large corporation formed by the merger of separate and diverse firms, focusing on a wide range of business activities and markets.

Mutual Fund

An investment vehicle made up of a pool of funds collected from many investors for the purpose of investing in securities such as stocks, bonds, and other assets.