Which one of the following is an opportunity cost of insurance?

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Which one of the following is an opportunity cost of insurance?

A. The payment of commissions to agents
B. An insurer's loss on invested premiums
C. An insured's funds that could be invested elsewhere if purchasing insurance were not necessary
D. The cost of claims payments that would not have been necessary if insureds' carelessness had not caused losses

Answer: C. An insured's funds that could be invested elsewhere if purchasing insurance were not necessary is an example of an opportunity cost of insurance.

Assignment Questions

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