ECONOMICS
INSURANCE
|
Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
|
All of the following are true of insurance in general, except:
|
|
It can reduce risk
|
|
|
It transfers risk
|
|
|
It eliminates risk
|
|
|
It reduces uncertainty
|
Explanation:
Detailed explanation-1: -They do not provide security to wealth.
Detailed explanation-2: -Insurance is the contract because it is an agreement where insurer promises to pay benefits to the insured.
Detailed explanation-3: -The functions of insurance are risk sharing, assisting in capital formation, economic progress, etc. Lending of funds is not a function of insurance.
Detailed explanation-4: -#1 – Pure Risk. #2 – Speculative Risk. #3 – Financial Risk. #4 – Non-Financial Risk. #5 – Particular Risk. #6 – Fundamental Risk. #7 – Static Risk. #8 – Dynamic Risk.
There is 1 question to complete.