Which of the following is a false statement?
A) Risk averse people will pay an insurance premium that is greater than the mathematically fair chance of loss in order to relieve themselves of uncertainty.
B) A risk seeker is willing to assume risk.
C) The mathematically fair price for insurance is the objective risk for the insurer multiplied by the maximum possible loss.
D) Insurance is never a mathematically fair trade because the insurer adds several operating and other costs to loss costs when it calculates the premium.
Correct Answer:
Verified
Q7: The ideal insurance system:
A) reduces the probability
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A)
Q9: Loss Transfer means:
A) shifting the financial consequences
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A) is only applicable to
Q11: Assume that 1000 students, all healthy, all
Q13: All the following are direct losses except:
A)
Q14: Which of the following is not a
Q15: Defective electrical wiring that may lead to
Q16: Which of the following is not a
Q17: Which of the following is a true
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