Risk - ANSWER the possibility of an unexpected loss
speculative risk - ANSWER can result in a gain, a loss
four risk management techniques - ANSWER avoid the risk
control the risk
Loma 281: Module 1 Lesson 1
Correct 100%
Risk - ANSWER the possibility of an unexpected loss
speculative risk - ANSWER can result in a gain, a loss
four risk management techniques - ANSWER avoid the risk
control the risk
accept the risk
transfer the risk
Parties involved in insurance transaction - ANSWER applicant
policyowner
insured
beneficiary
characteristics of an insurable risk - ANSWER the risk must be a pure risk
loss must occur by chance
loss must be definite in time and amount
the loss must be significant
the loss rate must be predictable
loss cannot be catastrophic to the insurer
law of large numbers - ANSWER predict loses based on this value
Two basic types of life insurance product - ANSWER life insurance: the insurer promises to pay a
death benefit when a a named person dies
Annuity: in return for recv a premium, an insurer promises to make periodic payments.
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