Final answer:
The Insurance Companies Act includes regulations for pension, deposit, and workman's compensation insurance, ensuring that premiums cover claims, operational costs, and company profits, while also considering actuarial fairness among different risk groups.
Step-by-step explanation:
The Insurance Companies Act generally covers regulations that insurance companies must follow to ensure the safety and fairness of insurance practices for the public.
This includes various types of insurance such as pension insurance, where employers contribute to the Pension Benefit Guarantee Corporation to protect employees' pensions, deposit insurance.
Where banks pay into the Federal Deposit Insurance Corporation to guarantee depositor's funds up to $250,000, and workman's compensation insurance, which ensures workers who suffer an injury on the job receive benefits funded by employer contributions.
Additionally, the act considers the complexities of insurance such as investment income, administrative costs, and varied risk groups.
It ensures that premiums collected cover claims, operational costs, and profits. For example, when charging premiums, insurers must consider actuarial fairness, which may require them to charge different premiums to different risk groups to avoid financial losses if a single actuarially fair premium is charged to everyone.