Question

1. insurance companies make money by... 1 pointrefusing to pay out claims to policyholderscollecting money from the governmentcollecting more in premiums than they need to pay out each yearkeeping costs low with minimal advertising5. which of the following statements is true about auto insurance premiums? 1 pointif you have an auto insurance policy and dont get into a car accident or file any claims for a year, you get your premiums back from the insurance companyif you have an auto insurance policy and get into multiple accidents within one year, your premium amount will decreaseauto insurance premiums are a fixed price across all insurance companiesif you have an auto insurance policy and get into multiple accidents within one year, your premium amount will increase

Explanation:

For question 4: Insurance companies' core profit model relies on underwriting profit, which is the difference between total premiums collected and total claim payouts plus operating costs. The other options are incorrect: refusing valid claims is unethical/illegal, most insurers don't rely on government funds, and minimal advertising is a cost-cutting measure not the main profit source.
For question 5: Auto insurance premiums increase after multiple accidents because the policyholder is deemed higher risk. The other options are wrong: premiums are not refunded for no claims, accidents raise (not lower) premiums, and premiums vary by insurer.

Answer:

1. Collecting more in premiums than they need to pay out each year
2. If you have an auto insurance policy and get into multiple accidents within one year, your premium amount will increase