Which one of the following statements is correct regarding the benefits that insurance provides?

Which one of the following statements is correct regarding the benefits that insurance provides?



A. The premiums collected by insurers must be held in cash to be available to pay claims.
B. Insurance provides a source of investment funds for insurers, but not for insureds.
C. Insurers are prohibited from investing in such things as research or technological advancements.
D. Investment income helps keep insurance premiums at a reasonable level.


Answer: D. Investment income helps keep insurance premiums at a reasonable level.

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