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18 Cards in this Set
- Front
- Back
Risk
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The chance of financial loss from perils to people or property.
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Insurance
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A method for spreading individual risk among a large group of people to make losses more affordable for all.
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Insurer
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A business that agrees to pay the cost of potential future losses in exchange for regular free payments.
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Policy
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A written insurance contract.
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Premium
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The fee a policyholder agrees to pay to an insurance company periodically (monthyly, quarterly, annually, or semiannually) for an insurance policy.
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Policyholder
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The person who owns an insurance policy.
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Indemnification
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Putting the policyholder back in the same financial condition he or she was in before the loss occurred.
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Probability
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The mathematics of chance and the root of indemnification.
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Personal Risks
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The chances of loss involving your income and standard of living.
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Property Risks
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The chances of loss or harm to personal or real property.
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Liability Risks
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The chances of loss that may occur when your errors or inappropriate actions result in bodilyinjury to someone else or damage to someone else's property.
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Pure Risk
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A chance of loss with no chance for gain.
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Speculative Risk
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A risk that may result ineither gain or loss.
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Insurable Interest
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Any financial interest in life or property such that, if the life or property were lost or harmed, the insured would suffer financially.
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Risk Management
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An organized strategy for controlling financial loss from pure risks.
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Risk Avoidance
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Elimination the chance for loss by not doing the activity that could result in the loss.
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Risk Assumption
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Self-insuring; establishing a monetary fund to cover the cost of a loss.
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Risk Reduction
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Taking meausures to lessen the frequency or serverity of losses that may occur.
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