Hello, my name is Vic Schumacher. The company
is HPE Financial Services. A question was recently asked how do insurance companies
establish premiums? Premiums are determined by the company in a way by a mathematician
called an actuary, and they decide exactly what are the odds of something happening occur,
okay? Based upon this risk of loss they will come up with certain dollar amounts on the
premiums, the odds in other words. Premiums are also determined by the type of person,
the job that you might have, the gender of the person seeking those premiums, the age
of the person if it comes with life insurance or health insurance. And many times the policies
themselves have premiums determined by the state, the state in which the insurance company
is selling its product. Some would be state regulated, and they cannot go beyond a certain
limit. Sometimes they can be raised or lowered based upon the requirements of the state.
Premiums themselves will always change, especially with life insurance and health insurance because
the person gets older year after year, so you have to adjust for that factor as well.
I hope this was helpful. My name is Vic Schumacher, company is HPE Financial Services.