The idea of insurance a. is to share risk. b. would not appeal to a risk-averse person. c. is, other things the same, to reduce the probability of a fire, accident, or death. d. is to provide a sure thing, not a gamble.

Question

Business

Ashleigh Hunter

4 January, 15:41

The idea of insurance a. is to share risk. b. would not appeal to a risk-averse person. c. is, other things the same, to reduce the probability of a fire, accident, or death. d. is to provide a sure thing, not a gamble.

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Damari Hicks · Answer 1

is to share risk.

Explanation:

Insurance is a means by which individuals and businesses avoid the risk of a loss. It is a risk management strategy that is used to hedge against the risk of uncertain loss.

So risk is shared with other parties usually the insurance company in the event of a loss.

The insurance company collects a payment called premium to maintain this agreement. The premium acts as a financial cushion for the insurance firm, and also provides means of settling loss claims.

For example a company can buy insurance against fore loss and pay premiums. In the event of a fire the insurance company is liable to reimburse the company for losses incurred.