When the chance of loss is great and the potential for loss severity is also very high, insurance is the best approach to the risk management problem.

Question

Quizplus · Accepted Answer

While insurance can be a part of managing high-severity risks, it is not always the best approach. Other strategies such as risk avoidance, mitigation, or transfer might be more effective depending on the specific circumstances.

When the Chance of Loss Is Great and the Potential