In: Finance
An insurance company collected $3.7 million in premiums and disbursed $1.97 million in losses. Loss adjustment expenses amounted to 6.7 percent and dividends paid to policyholders totaled 1.3 percent. The total income generated from their investments was $180,000 after all expenses were paid. What is the net profitability in dollars? (Enter your answer in dollars not in millions.) |
Net profitability | $ |
Expenses = 0.067 x $3,700,000 = $247,900
Dividends = 0.013 x $3,700,000 = $48,100
Investment returns = $180,000
Netprofits = $3,700,000 - $1,970,000 - $247,900 - $48,100 + $180,000
= $1,614,000
Thanks