From the standpoint of the insured,deductibles in insurance contracts are a form of:
A)Risk transfer
B)Loss control
C)Risk avoidance
D)Risk retention

Question

Quizplus · Accepted Answer

Deductibles are a form of risk retention because the insured is taking on a portion of the potential loss in the event of a covered claim. The insured agrees to pay the deductible amount out of pocket before the insurance company begins to cover the remaining costs of the claim. This can help reduce premiums and encourage policyholders to be more responsible with their insurance coverage. Risk transfer involves transferring the risk of loss to another party, such as an insurance company, while loss control and risk avoidance aim to prevent losses from occurring in the first place.

From the Standpoint of the Insured,deductibles in Insurance Contracts Are