Florida Insurance Licensing Practice Exam

Which of the following is an advantage of a commercial package policy over monoline policies?

1. The package policy is easier to rate and sell - more efficient

2. In the package policy, coverage gaps are less likely to occur

3. Premium savings may result from a package policy

4. All of the above

The correct answer is: All of the above

A commercial package policy is a single insurance policy that combines several types of coverage for businesses. In contrast, monoline policies provide coverage for a single type of risk. The advantage of a commercial package policy over monoline policies is that it offers a more efficient and cost-effective option for businesses, as they only need to manage and pay for one policy. The package policy also reduces the risk of coverage gaps by including multiple coverages in one policy, providing broader protection for the business. Additionally, premium savings may result from bundling coverage under one policy. Therefore, option D, "All of the above," is the correct answer as it encompasses all the advantages of a commercial package policy over monoline policies. Options A, B, and C are incorrect as they only highlight individual advantages of a commercial package policy.