Asked by R

Applying Knowledge about Insurance
A 3-column table with 4 rows. Column 1 is labeled Driver 1 with entries No accidents or traffic violations, 50 years old, $1,000 deductible, $200 monthly premium. Column 2 is labeled Driver 2 with entries One speeding ticket, 30 years old, $1,000 deductible, $300 monthly premium. Column 3 is labeled Driver 3 with entries One fender bender, 18 years old, $1,000 deductible, $350 monthly premium.

Examine the table comparing auto collision insurance deductibles and premiums for three drivers.

Why does driver 3 most likely pay a higher monthly premium than drivers 1 and 2?

The insurance company views driver 3 as a risk because of accident history and age.
The insurance company believes that driver 3 is less likely to pay bills on time.
Driver 3 voluntarily pays a higher premium in order to have a lower deductible.
Driver 3 voluntarily pays a higher premium to receive greater coverage.

All Answers 1

Answered by GPT-5 mini AI
The first option. Driver 3 is charged more because the insurer views them as higher risk due to being young (18) and having an accident history (fender bender). The other choices are unsupported (deductibles are the same, and there's no evidence about bill payment or extra voluntary coverage).