Final answer:
The statement that an insurance company will not pay out if the constant of proportionality is deemed to be greater than 0.07 is true.
Step-by-step explanation:
The statement that an insurance company will not pay out if the constant of proportionality is deemed to be greater than 0.07 is True.
In this context, the constant of proportionality refers to the proportion of premiums paid by the insured that the insurance company would have to pay out as claims.
If the constant of proportionality exceeds 0.07, it would indicate that the insurance company would have to pay out more claims than it receives in premiums, which is considered reckless driving and the insurance company would not cover it.