Which of the following is not a reason for using deductibles in property insurance?
A)they reduce the morale hazard
B)they eliminate payment for frequent small losses
C)they allow consumers to customize contracts based on financial considerations
D)to split large losses in excess of the policy limits equitably between the insured and the insurer

Question

Quizplus · Accepted Answer

Deductibles are used to eliminate payment for frequent small losses, reduce the morale hazard, and allow consumers to customize contracts based on financial considerations. However, splitting large losses in excess of the policy limits equitably between the insured and the insurer is typically addressed by reinsurance rather than deductibles.

Which of the Following Is Not a Reason for Using