The Operating Ratio for a PC Insurer Equals

question 51

Multiple Choice

The operating ratio for a PC insurer equals

• A)loss ratio plus the ratios of loss adjustment expenses to premiums earned.
• B)loss ratio plus expense ratio plus dividend ratio.
• C)combined ratio minus dividends paid to policyholders.
• D)acquisition costs plus dividends paid as a proportion of premiums earned.
• E)combined ratio after dividends minus the investment yield.

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Definitions:

Escalation of Commitment

A decision-making error in which individuals or organizations continue a course of action despite facing negative outcomes or feedback.

Preferences

Individual choices or inclinations regarding various options, based on personal likes, dislikes, values, or interests.

Programmed Decision-Making

A method of decision-making using established procedures or rules for routine or repetitive problems requiring predictable solutions.

Alternative Solutions

Different methods or approaches to solving a problem or addressing a situation, offering multiple options for consideration.