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17 Cards in this Set
- Front
- Back
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Retention
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A risk financing technique that involves assumption of risk in which gains and losses are retained within the organization.
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Insurance
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A risk management technique that transfers the potential financial consequences of certain specified loss exposures from the insured to the insurer.
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Risk Financing
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A conscious act or decision not to act that generates the funds to offset the variability in cash flows that may occur as an outcome of risk.
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Soft Market
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Market conditions in which insurer competition is intense and is indicated by widely available coverage, lower premiums, and decreased insurer profitability.
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Hedging
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A financial transaction in which one asset is held to offset the risk associated with another asset.
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Hard Market
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Market conditions in which insurer competition diminishes, buyers have difficulty finding coverage, premiums increase, and insurer profitability rises.
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Risk Management Framework
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A foundation for applying the risk management process throughout the organization.
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Liquid Assets
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Property that can be quickly and easily converted into cash.
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Hazard Risk
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Risk from accidental loss, including the possibility of loss or no loss.
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Risk Criteria
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Reference standards, measures, or expectations used in judging the significance of a given risk in context with strategic goals.
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Business Risk
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Risk that is inherent in the operation of a particular organization, including the possibility of loss, no loss, or gain.
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Hold Harmless/Indemnity Agreement
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A contractual provision that obligates one of the parties to assume the legal liability of another party.
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Transfer
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In the context of risk management, a risk financing technique by which the financial responsibility for losses and variability in cash flows is shifted to another party.
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Speculative Risk
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A chance of loss, no loss, or gain.
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Risk
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Uncertainty about outcomes that can be either negative or positive.
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Enterprise Risk Management
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An approach to managing all of an organization's key business risks and opportunities with the intent of maximizing shareholder value.
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Futures Contract
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An exchange-traded agreement to buy or sell a commodity or security at a future date at a price that is fixed at the time of the agreement.
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