ECONOMICS
INSURANCE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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bank loans.
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premature death.
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sickness or disability.
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continuous stream of income during retirement (i.e. old age).
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All of the above.
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Detailed explanation-1: -Most insurance providers only cover pure risks, or those risks that embody most or all of the main elements of insurable risk. These elements are “due to chance, ” definiteness and measurability, statistical predictability, lack of catastrophic exposure, random selection, and large loss exposure.
Detailed explanation-2: -Insurable Types of Risk There are generally 3 types of risk that can be covered by insurance: personal risk, property risk, and liability risk. Personal risk is any risk that can affect the health or safety of an individual, such as being injured by an accident or suffering from an illness.
Detailed explanation-3: -Life insurance is a contract between an insurer and a policy owner. A life insurance policy guarantees that the insurer pays a sum of money to named beneficiaries when the insured dies in exchange for the premiums paid by the policyholder during their lifetime.
Detailed explanation-4: -There are four main risk classes: preferred plus, preferred, standard plus, and standard. Your risk class is determined by factors like your age, health, occupation, and lifestyle. If you’re in a higher risk class, you may have to pay more for life insurance.