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Do package policies increase insurance company costs?

Updated: 8/17/2019
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Ande3674

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14y ago

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In any business, where there exists a time-work-for-price factor, a proportional adjustment between any of the three 3 will result in a real difference in cost of 'production' to the company.
Normally, in ANY business field, in order to get the bigger job and, therefore, ensure a larger sale in money terms, the company or business will sell "packages" of a combination of more than one service at a reduced rate against what would have been the total cost had the person bought and paid for each individual service one at a time.
If the client genuinely sees benefit in purchasing the extra product/s, this will benefit both - client and company ... BUT as the company has effectively reduced its usual rates, its profit will not be as great as for individual purchases, and there will be more administration and, usually, storage costs for dealing with [say] 3 products for the one person than for one.
Then again, however, the costs will likely be less than necessary for handling three separate clients. So, there are many incidentals and specifics involved in any genuine cost-benefit analysis regarding a company's offering of package policies.
For the most part, however, as far as the company is concerned, the monetary rewards of offering 'package' deals is well worth any extra effort or any greater administrative cost involved.

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