ABC Insurance Company plans to sell homeowners insurance in five Western states.ABC expects that 8 homeowners out of every 100,on average,will report claims each year.The variation between the rate of loss that ABC expects to occur and the rate of loss that actually occurs is called

Question

Quizplus · Accepted Answer

Objective risk is the variation between the expected loss and the actual loss. It is quantifiable and can be statistically calculated, which applies to the scenario described for ABC Insurance Company.

ABC Insurance Company Plans to Sell Homeowners Insurance in Five