Insurance companies invest mainly in instruments trade on the?

Assessment: JAMB UTME - Economics - 2002 Subject: Economics

Question 1 Report

Insurance companies invest mainly in instruments trade on the?
Answer Details
Insurance companies primarily invest in instruments traded on the capital market. The capital market is a market where long-term financial instruments, such as bonds and stocks, are traded. Insurance companies typically invest their premiums and other funds in financial instruments with long-term maturity dates, and the capital market is the best place to find such instruments. Investing in the capital market allows insurance companies to earn a return on their investments, which helps them pay claims and maintain their financial stability. Additionally, the capital market provides insurance companies with a way to diversify their investments, reducing their exposure to risk. Therefore, the correct answer is "capital market."

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