When deciding to approve or disapprove an insurer's request for a rate, a state insurance commissioner must determine if the rates are adequate. This means that the rates should be

When deciding to approve or disapprove an insurer's request for a rate, a state insurance commissioner must determine if the rates are adequate. This means that the rates should be



A. Similar to the rates charged by other insurers operating in the state.
B. Similar for insureds with similar loss exposures.
C. Sufficient to pay all claims and the expenses related to those claims.
D. Able to generate a fair return for the insurer but no to excessive or unrealistic profit.


Answer: C. Sufficient to pay all claims and the expenses related to those claims.

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