Why is it critically important to check out the financial health of a Life Insurance Company through a ratings company like A.M. Best before you purchase the insurance?
What will be an ideal response?
Answer: When you purchase a life insurance policy, you are basically entering into a partnership with the Insurance Company that may last for 40+ years or more. You want to make certain that this company or partner will be there when your beneficiaries desperately need the death benefit of the policy. It is not unusual for Insurance companies to become insolvent and fail. It is not unusual for Insurance scams to happen, especially via the internet. Ratings companies evaluate the financial health of the Insurance company and their ratings are a good predictor of the ability of the Insurance company to remain solvent for many years into the future. There would be nothing worse than for your Insurance company to fail after you have paid premiums for many years and you have developed a pre-existing health condition during this time. Now you may have a hard time finding a new Insurance company or the premium may be cost prohibitive due to age and health.
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If Viera, Inc., has an accounts receivable turnover of 3.9 times and net sales of $3,436,812, what is its level of receivables?
A) $881,234 B) $13,403,567 C) $1,340,357 D) $81,234
Which of the following is a result of the protection of domestic companies from international competition?
A) Consumers need to pay lesser for products. B) There are increased incentives to cut production costs and improve quality. C) Companies become more reliant on protection. D) Protection increases a company's incentives to obtain the knowledge it needs to become more competitive.