III IC-102 Practice Questions - III IC-102 Insurance Business Ecosystem Exam

How does an increase in the central bank's interest rates typically impact a life insurance company's operations?

It reduces the company's investment income on new fixed-income securities. It increases the company's investment income, improving profitability. It forces the company to increase premium rates for existing term life policies. It directly reduces the mortality rate among policyholders.

Correct Answer:

It increases the company's investment income, improving profitability.

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