All of the following statements about the combined ratio are true EXCEPT
A) It is equal to the loss ratio plus the expense ratio.
B) A combined ratio greater than 1 (or 100 percent) means an underwriting loss has occurred.
C) The combined ratio does not consider investment income.
D) A combined ratio less than 1 (or 100 percent) indicates that an underwriting loss has occurred.
Correct Answer:
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