Quote:
Originally Posted by bishoo123
Insurance company X is considering issuing a new policy to cover services required by elderly people who suffer from disease that afflict the elderly.premiums for the policy must be low enough to attract the customers .therefore company X is concerned that the income from the policies would not be sufficient to pay for the claims that would be made .
Which of the following strategies would be most likely to minimize company X's losses on the policies ?
a.attracting middle aged customers to submit claims for benefits for many years .
b. insuring only those individuals who did not suffer from diseases as children
c.including a greater number of services in the policy than are included in other policies of lower cost
d.insuring only those individuals who are wealthy enough to pay for the medical services.
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How about "
d.insuring only those individuals who are wealthy enough to pay for the medical services." as most of these individuals would not file a claim(as they are wealthy enough) and keep paying premium for the insurance, hence minimizing the payments by Insurance company X.