Risk - correct answer Chance of loss
5 Risk or Loss Factors - correct answer 1. Risk 2. Loss 3. Exposure 4. Peril 5. Hazard
Insurance allows: -
... [Show More] correct answer Individual or group to transfer over to insurance company the risk of financial loss from a destructive event
Fundamental purpose of insurance is: - correct answer To indemnify policyholder against covered losses or restore policyholder back to same financial position they were in before
Insurance companies may used term risks to refer to insured: - correct answer 1. Person 2. Property 3. Activity
Loss - correct answer Unplanned or unwelcome reduction in economic value
What is Direct and Indirect loss - correct answer 1. Direct loss - immediate result of and event caused by a covered peril 2. Indirect loss - remote result of an event caused by covered peril
Exposure - correct answer State of being subject to a possible loss
Insurer measures exposure by - correct answer Units to the person, property or event (more exposure units, the greater the premium)
Exposure is also referred to as: - correct answer Total risk an insurer faces with insured
Peril - correct answer The destructive event that insurance guards against
6 types of peril - correct answer 1. Fire 2. Explosion 3. Windstorm 4. Flood 5.Theft 6. Collision
Insurance policy provides - correct answer Financial protection against losses caused by specified peril
Havard - correct answer Is condition that increases the likely occurrence of a peril or severity of a loss
Name the 3 types of hazards - correct answer 1. Moral 2. Morale 3. Physical
Moral hazard - correct answer Tendencies or traits of an individual that increases the chance of a loss
Morale hazard - correct answer Tendencies of individual that increase the chance of a loss from state of mind, attitude, or indifference
Physical Hazard - correct answer Physical conditions that increase the chance of loss
Name 6 types of physical hazards: - correct answer 1. Insufficient light in high crime commercial area 2. Potholes 3. Slippery floors 4. Unsanitary conditions 5. Congested traffic 6. Unguarded premises
Legal hazard - correct answer Legal or regulatory environment characteristics that affect an insurer's ability to provide premium at a fair price that reflects loss exposure
Risk management - correct answer How people deal with risk
Name 5 risk management techniques: - correct answer 1. Avoidance [Show Less]