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WAEC Commerce 1991 (August) Question 19

Question 19

Insurance

The method by which insurance companies spread their risks to other insurance companies is called

  1. A.double insurance
  2. B.under-insurance
  3. C.re-insurance
  4. D.over-insurance
  5. E.underwriting
Show the answer and explanation

Answer: C (re-insurance)

Explanation

Re-insurance passes part of a large risk to other insurers.