The foundational principle that makes insurance companies work is called:
A) risk pooling.
B) diversification.
C) catastrophic causation.
D) risk analysis.
Correct Answer:
Verified
Q85: Investing all your money in one company
Q87: The fee that insurance companies collect in
Q89: Insurance premiums represent:
A) the expected value of
Q90: Risk pooling:
A)reallocates the likelihood of catastrophes happening.
B)reallocates
Q93: Insurance:
A)reduces the risks inherent in life.
B)helps individuals
Q94: Insurance companies:
A)profit from the difference between the
Q95: Risk pooling:
A)doesn't reduce the risk of catastrophes
Q97: Risk pooling:
A)doesn't reduce the risk of catastrophes
Q98: When risks are shared across many different
Q98: Diversification involves:
A) investing all your money in
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