in 2009, the us state of hawaii enacted price - stability resolutions (rsrs) constituting the stance…

in 2009, the us state of hawaii enacted price - stability resolutions (rsrs) constituting the stance companies failure to raise (maintain) the periodic fees (policies) pay to maintain insurance policies after the policies are in effect. rsrs are effective at protecting existing policyholders from price volatility, but niels azevedo and ako kote note that dynamic dynamic pricing models are more effective at protecting new policyholders. they suggest that some insurers to start back or create cease selling new policies that are affected market, thereby reducing the competitive pressure that typically restrains premium prices, but now collapses. thus, hawaiis rsrs may ____. which choice most logically completes the text? a. benefit policy - holders at the expense of non - policyholders seeking to acquire policies b. reduce premium price volatility once policies are in effect but increase risks for policyholders c. reduce premium prices in premium prices for new policyholders, leading to fewer insurers offering such policies in the affected market d. be more advantageous for insurers than they are for either current or

in 2009, the us state of hawaii enacted price - stability resolutions (rsrs) constituting the stance companies failure to raise (maintain) the periodic fees (policies) pay to maintain insurance policies after the policies are in effect. rsrs are effective at protecting existing policyholders from price volatility, but niels azevedo and ako kote note that dynamic dynamic pricing models are more effective at protecting new policyholders. they suggest that some insurers to start back or create cease selling new policies that are affected market, thereby reducing the competitive pressure that typically restrains premium prices, but now collapses. thus, hawaiis rsrs may ____. which choice most logically completes the text? a. benefit policy - holders at the expense of non - policyholders seeking to acquire policies b. reduce premium price volatility once policies are in effect but increase risks for policyholders c. reduce premium prices in premium prices for new policyholders, leading to fewer insurers offering such policies in the affected market d. be more advantageous for insurers than they are for either current or

Answer

Brief Explanations:

  1. Analyze the passage: It states that RSRS are not effective at protecting existing policies from price volatility. Naka - zawa and Kao note that dynamic dynamic RSRS can have some negative impacts like restricting access to some resources, increasing costs and reducing the competitive pressure on prices.
  2. Evaluate options:
    • Option A: There is no mention of benefiting policymakers at the expense of non - policymakers in the passage.
    • Option B: Since RSRS don't protect existing policies from price volatility and can increase costs and reduce competition on prices, they can reduce premium price volatility once policies are in effect but increase risks for policyholders. This is consistent with the passage.
    • Option C: The passage does not suggest that RSRS lead to fewer insurers offering such policies in the affected market.
    • Option D: There is no indication that RSRS are more advantageous for insurers than for policyholders in the current or future market.

Answer:

B. reduce premium price volatility once policies are in effect but increase risks for policyholders.