Originally Posted by kanwar_26
These insurance schemes seems to be wonderfull
,but can anybody explain how is it profitable to insurance companies?
That would have something to do with the law of averages. Also remember that for a car costing say 10 Lakhs if the premium for a normal policy is approx 20K the premium for this new product is nearly double approx 38K. This is based on the quotes I got recently.
If we have an actuary in the house, they would be the best person to explain the relationship behind insurance premiums and the obvious profits from this business.