Which of the following statements about liability losses is true?
A) They arise from two sources: the obligation to pay legal damages, and the resulting bad publicity.
B) The obligation to pay legal damages is always more expensive than the cost of defense.
C) Defense costs can be expensive, unless the court finds that the plaintiff's claims are groundless.
D) None of the above is true.

Question

Quizplus · Accepted Answer

The statements provided in options A, B, and C are not universally true regarding liability losses. Liability losses can arise from various sources beyond legal obligations and bad publicity, and the cost relationship between legal damages and defense costs can vary significantly depending on the case. Defense costs can also be expensive regardless of the court's findings.

Which of the Following Statements About Liability Losses Is True