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Health and Life Insurance

Category - Annuities & Policies

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What helps to lower the premium rates?

Credit scores
Expenses
Interest on debt
Interest on premiums

Explanation

Answer: D - Interest on premiums helps to lower the premium rates. Insurance companies collect premiums in advance. This money is used for investments where interest can be earned. The insurance company needs to be able to make money as well as pay claims. Interest at a given rate should allow for the insurance company to pay all claims and still turn a profit.

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