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If the same event can cause losses to numerous policyholders of the same insurer, the ability of that insurer to issue policies becomes constrained, not by factors surrounding the individual characteristics of a 4 foot shower enclosure given policyholder, but by the factors surrounding the sum of all policyholders so exposed. The policy does not accumulate cash value. Monitoring the market, predicting market trends and accurately assessing prices play an important role”[7].
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