Risk pooling:
A)doesn't reduce the risk of catastrophes happening.
B)reallocates the costs of catastrophes when they occur.
C)allows individuals the peace of mind that they will never have to pay the full expense of a catastrophe if it hits them.
D)All of these statements are true.

Question

Quizplus · Accepted Answer

Risk pooling reallocates the costs of catastrophes when they occur, which can give individuals the peace of mind that they will not have to pay the full expense if it hits them. However, it does not reduce the risk of catastrophes happening. Therefore, all of the given statements are true.

Risk Pooling