Which of the following statements about the combined ratio is true? A
Which of the following statements about the combined ratio is true?
A) It is equal to the loss ratio minus the expense ratio.
B) A combined ratio greater than 1 (or 100 percent) means an underwriting loss has occurred.
C) The combined ratio considers the company’s investment income.
D) A combined ratio less than 1 (or 100 percent) indicates an underwriting loss has occurred.
ANSWER
Answer: B
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