PROPERTY AND CASUALTY INSURANCE LICENSE EXAM PREP QUESTIONS AND ANSWER | LATEST UPDATE
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Course
PROPERTY AND CASUALTY INSURANCE
Institution
PROPERTY AND CASUALTY INSURANCE
Insurance
-:- Transferring risk or loss to an insurance company
Law of Large Numbers
-:- Sharing risk between a large pool of people
Statistical Prediction
-:- Using past losses to predict future losses
Insurable Interest
-:- Having a financial stake in the insured property
Elements of ...
✓ -:- Uncertainty or likelihood of a loss occurring
Pure Risk
✓ -:- Circumstances that can only result in no change or a loss
Speculative Risk
✓ -:- Opportunity for either gain or loss
Perils
✓ -:- Causes of loss that insurance providers cover
Homogeneous Group
✓ -:- A large pool of people with similar loss exposure
Insurance Mechanism
✓ -:- Transferring costs of unforeseen losses to many individuals
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