Question

Eleanor paid an annual premium of $2,000 in total coverage for her homeowner's insurance, including $250,000 in damage coverage and $250,000 in liability coverage. Six years into her policy, a tree fell on Eleanor's home and caused $40,000 worth of damage. Eleanor's insurance company paid the claim. Did the cost of the benefit of transferring the risk to the insurance company outweigh the cost of the premium? (5 points)
Yes, the cost of the annual premium for 10 years was more than the accident claims

Yes, the cost of the annual premium for 10 years was less than the accident claims

No, the cost of the annual premium for 10 years was the same as the accident claims

No, the cost of the annual premium for 10 years was more than the accident claims

Answer 1

Answer:

Yes, the cost of the annual premium for 10 years was less than the accident claims

Explanation:

Answer 2

The answer in this question is B Yes because the cost of the annual premium for 10 years was less than the accident claims. The cost of the insurance benefit of transferring the risk to the insurance company outweigh the cost of the premium because of the cost of the annual premium for 10 years was less than the accident claims.