RMIN 4000 UGA Brown Test 1 Ch 1-4 | Latest Version | Graded A+
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Course
RMIN 4000 UGA
Institution
RMIN 4000 UGA
RMIN 4000 UGA Brown Test 1 Ch 1-4 |
Latest Version | Graded A+
How does risk sharing help reduce the financial impact of a loss?
Risk sharing distributes potential losses among multiple parties, reducing the burden on any
one individual or organization.
What is the role of risk appetite...
RMIN 4000 UGA Brown Test 1 Ch 1-4 |
Latest Version | Graded A+
How does risk sharing help reduce the financial impact of a loss?
✔✔ Risk sharing distributes potential losses among multiple parties, reducing the burden on any
one individual or organization.
What is the role of risk appetite in determining a company's risk management strategy?
✔✔ Risk appetite defines how much risk a company is willing to accept while pursuing its
objectives, guiding its decisions on risk control and transfer.
How does the law of large numbers apply to insurance?
✔✔ The law of large numbers states that as the number of exposure units increases, the actual
loss experience will more closely resemble the expected loss, making predictions more accurate.
What is the primary purpose of a risk retention group?
✔✔ A risk retention group allows businesses with similar risks to pool their resources and self-
insure against certain risks.
1
, What is the difference between risk retention and risk financing?
✔✔ Risk retention means keeping responsibility for losses internally, while risk financing
involves securing funds to pay for potential losses, often through insurance or other financial
arrangements.
Why is understanding time value of money important in risk management?
✔✔ It helps businesses evaluate the present value of future risks and determine the most cost-
effective risk management strategies.
What is the impact of insurance underwriting on risk management?
✔✔ Underwriting assesses the risk profile of an applicant and determines the terms of coverage,
ensuring that insurers only take on acceptable levels of risk.
How do insurance deductibles influence risk retention?
✔✔ Deductibles require the insured to bear part of the loss, encouraging them to take preventive
measures and reducing the likelihood of small claims.
What role does loss prevention play in risk management?
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