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Insurance is a device designed to increase risk by combining exposure units to make their individual losses collectively unpredictable.
Insurance is a device designed to increase risk by combining exposure units to make their individual losses collectively unpredictable.
False
In an insurance system, the burden of loss falls solely on the homeowner without any redistribution.
In an insurance system, the burden of loss falls solely on the homeowner without any redistribution.
False
According to Prof. Alan H. Willett, insurance involves transferring risks from many individuals to one person or a group of persons.
According to Prof. Alan H. Willett, insurance involves transferring risks from many individuals to one person or a group of persons.
True
Insurance does not involve a combination of risks according to the multiple schools of thought discussed.
Insurance does not involve a combination of risks according to the multiple schools of thought discussed.
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The law of large numbers and central limit theorem ensure that a sufficiently large number of homogeneous risks will produce unpredictable aggregate results.
The law of large numbers and central limit theorem ensure that a sufficiently large number of homogeneous risks will produce unpredictable aggregate results.
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Insurance is a contract whereby one party agrees to compensate another party for losses.
Insurance is a contract whereby one party agrees to compensate another party for losses.
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The insurer is the party whose loss causes the insurer to make a claims payment.
The insurer is the party whose loss causes the insurer to make a claims payment.
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Premium is the payment the insured receives.
Premium is the payment the insured receives.
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Insurance can be defined as the transfer of speculative risk from the insured to the insurer.
Insurance can be defined as the transfer of speculative risk from the insured to the insurer.
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The primary business of the insurer is risk avoidance for a fee.
The primary business of the insurer is risk avoidance for a fee.
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According to Prof. Mehr and Cammack, insurance is a social device for reducing risk by combining a sufficient number of exposure units to make their individual losses collectively predictable.
According to Prof. Mehr and Cammack, insurance is a social device for reducing risk by combining a sufficient number of exposure units to make their individual losses collectively predictable.
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Insurance operates by redistributing the burden of loss to all homeowners when there is no insurance system in place.
Insurance operates by redistributing the burden of loss to all homeowners when there is no insurance system in place.
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According to Prof. Alan H. Willett, insurance involves transferring risks of many individuals to one person or a group of persons.
According to Prof. Alan H. Willett, insurance involves transferring risks of many individuals to one person or a group of persons.
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Insurance can be defined as a mechanism that involves transferring risks without any combination of risks according to the discussed schools of thought.
Insurance can be defined as a mechanism that involves transferring risks without any combination of risks according to the discussed schools of thought.
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The law of large numbers and central limit theorem ensure that a sufficiently large number of homogeneous risks will produce unpredictable aggregate results.
The law of large numbers and central limit theorem ensure that a sufficiently large number of homogeneous risks will produce unpredictable aggregate results.
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