Can I reason that the high risk flood insurance pool option is affordable because premiums can be capped and subsidized?
The web based problem seems to disagree.
In a way I think (b) is correct too but perhaps (a) is a better description of the high-risk pool. Premiums are capped because the insurer can cede away poor risks to the high risk pool
I tried to make the answers match as closely as possible to what was stated (or implied) in the source text, but it's not an exact science. I think as long as your answer is logical and clearly written, it would be marked correct. Do you have any further insight @Staff-T1 ?
No, Graham is right. In the actual exam (a) and (b) would be acceptable answers. Although with option (b) I would say subsidies are provided by allowing insurers to pass on additional risk from high-risk policies to the pool
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In a way I think (b) is correct too but perhaps (a) is a better description of the high-risk pool. Premiums are capped because the insurer can cede away poor risks to the high risk pool
I tried to make the answers match as closely as possible to what was stated (or implied) in the source text, but it's not an exact science. I think as long as your answer is logical and clearly written, it would be marked correct. Do you have any further insight @Staff-T1 ?
No, Graham is right. In the actual exam (a) and (b) would be acceptable answers. Although with option (b) I would say subsidies are provided by allowing insurers to pass on additional risk from high-risk policies to the pool