What is a major disadvantage for a policyholder of a packaged policy compared to a combined policy?

The correct answer highlights a significant disadvantage of a packaged policy in comparison to a combined policy. Packaged policies typically come with standardized terms and conditions that apply to a range of coverages bundled together. This means that the policyholder has limited flexibility to tailor the policy wording or coverages to meet their specific needs.

In contrast, combined policies often allow greater customization, enabling policyholders to modify clauses and adapt coverage options to better fit their individual circumstances or business requirements. This adaptability can lead to more precise risk management and potentially better protection aligned with the policyholder’s needs.

The other options may not hold true universally across all packaged and combined policies. For example, claims conditions can vary widely and are not inherently more onerous in bundled offerings. Similarly, excesses and premiums are determined by several factors, and it isn't accurate to assert that they are always higher in either type of policy without considering specific circumstances or terms. Thus, the inability to tailor the wording in a packaged policy is a defining disadvantage that can limit coverage effectiveness for the policyholder.