Traditional Life Practice Questions - Insurance Commission Licensure Exam - Traditional Life (Philippines) Exam

Which of the following describes the 'Law of Large Numbers' as applied to life insurance?

The larger the number of similar exposure units observed, the more predictable the future losses will be The larger the premium collected, the larger the cash value growth will be The larger the number of agents in a company, the lower the administrative expenses The larger the face value of a policy, the higher the interest rate credited to it

Correct Answer:

The larger the number of similar exposure units observed, the more predictable the future losses will be

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