What is the role of an insurance company?

• A. Sell insurance policies
• B. Regulate premium rates
• C. Assess crop yields
• D. Provide legal advice

Answer: (A)

The primary role of an insurance company is to sell insurance policies. This involves offering various types of coverage to protect individuals and businesses against specific risks. The process begins with assessing the needs of the customer and then providing a policy that meets those needs, whether it be for property, health, auto, or liability insurance. The insurance company takes on the risk associated with potential events, and in exchange, policyholders pay premiums to the company. This creates a safety net for insured individuals, allowing them to recover financially from losses incurred due to covered events.

In the context of the other options, while regulating premium rates and assessing crop yields are relevant to some aspects of insurance and other industries, they do not represent the core function of an insurance company. Providing legal advice is also not a direct function of an insurance company, although they may partner with legal consultants or provide some legal resources regarding policy interpretation. The main focus remains on the selling and managing of insurance policies to ensure that risks are effectively mitigated for their clients.