Question

Why is there a tradeoff between a lower deductible and higher premium?

A)
Paying a lower deductible means you can afford higher premiums.
B)
A lower deductible means the insurance company must pay more in an
accident so they make you pay for that risk.
The insurance company wants you to pay a lower deductible so they offer
you a higher premium as an incentive,
D)
It works just like the law of demand, the higher the price, the lower the
quantity demanded,

Answer 1

B)

Step-by-step explanation:

Deductible is the amount that a person pays to the insurer for a health insurance before the insurer pays towards the policy coverage.

The lower a plan's deductible, the higher the premium. It means a lower deductible shows that an insurance company have to pay more if the person meet an accident so they make you pay for that risk.

Hence, the correct answer is "B) ."