Which of the following statements is TRUE?
A) Since insurance companies generate the vast majority of revenue from investments of premium payments, market fluctuations will not affect one's health care benefits.
B) Since insurance companies generate the vast majority of revenue from premium payments, market fluctuations generally do not affect one's health insurance premium.
C) Since insurance companies also generate revenue from investments of premium payments, market fluctuations may affect one's health insurance premium.
D) Since insurance companies also generate revenue from investments of premium payments, market fluctuations may affect one's health care benefits.
E) Since insurance companies generate revenue from both premium payments and investments thereof, market fluctuations will not generally affect one's health insurance benefits.

Question

Quizplus · Accepted Answer

C)Insurance premiums are set to make a profit, not simply to have an expected break-even value (as they were originally meant to do). Thus, if market fluctuations get too erratic, premiums might be set higher to compensate for this.

Which of the Following Statements Is TRUE