Question

What happens to the total amount of premium paid for an insurance policy when the payment frequency increases?

A. No difference in cost
B. Decreases
C. Increases
D. Depends on the type of coverage

Answer 1

C. Increases

Step-by-step explanation:

When payment frequency increases, it results to lesser amount per payment which will lead to a higher total amount of premium paid. consider this general rule of thumb; the greater the number of payments, the higher the actual premium paid over the course of the year.