Risk pooling:
A)reallocates the likelihood of catastrophes happening.
B)reallocates the costs of catastrophes when they occur.
C)diversifies the risk of catastrophes occurring.
D)gathers individuals with similar risks and pools them together.

Question

Quizplus · Accepted Answer

Risk pooling reallocates the costs of catastrophes when they occur by spreading the financial impact across all members of the pool, rather than changing the likelihood of the events themselves.

Risk Pooling