Assume you are buying insurance for your home. Your agent tells you that the pure premium is $300 and that the insurance company charges a loading of 5% of the gross premium. How much is your total premium?

$ 315

Explanation:

Given that

Pure premium = $300

Insurance company charges = 5%

Thus,

Amount of insurance company changes = 300 × 5%

= 300 × 0.05

= $15

Therefore,

Total premium = pure premium + insurance company charges

= 300 + 15

= $ 315

Note that: Premium is simply the amount to be paid regularly to an insurance company for an insurance policy. It is the money paid periodically by the insured to the insurer.

you had the wrong answer