Question 1023 of 303 · California Life-Only Agent Exam
An insurer that sells a large number of similar policies is relying on which concept to make costs predictable?
Exactly one answer is correct.
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Correct answer to question 1023
- A: Pooling of exposures
Explanation
Pooling spreads the losses of a few across many insureds. The law of large numbers makes the expected loss predictable.
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