eli5, how do insurance companies make money.

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My cousin and I are going to try to start a business so we needed insurance. The insurance is a 160 something dollars a month and covers 2 1,000,000 dollars accidents. Where do they make there money?

In: Economics

15 Answers

Anonymous 0 Comments

By paying out less money than they take in, they calculate the risk of an accident and how much that will cost and adjust fees accordingly.

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