Last Year,XYZ Insurance Company Had a Combined Ratio of 102

question 20

Multiple Choice

Last year,XYZ Insurance Company had a combined ratio of 102.4 and lost $10.2 million on the insurance that it sold.The company,however,was required to pay income taxes.The best explanation for this apparent contradiction is that XYZ offset its underwriting loss with

• A)increased loss reserves.
• B)investment income.
• C)increased loss adjustment expenses.
• D)unearned premiums.