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    Question

    How does a "hard market" typically begin?

    A When insurers experience significant investment losses. Correct Answer Incorrect Answer
    B When the demand for insurance exceeds the available supply. Correct Answer Incorrect Answer
    C When insurers experience a series of large and unexpected losses Correct Answer Incorrect Answer
    D When government regulations restrict insurance pricing Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    The correct answer is C. When insurers experience a series of large and unexpected losses. Hard markets often begin with a series of catastrophic events or a significant increase in claims, leading to higher losses for insurers.

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