RMIN 4000 Test 2 Daniel Brown Questions and Answers | Latest Update | 2024/2025 | 100% Verified
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Module
RMIN 4000
Institution
RMIN 4000
RMIN 4000 Test 2 Daniel Brown
Questions and Answers | Latest Update |
2024/2025 | 100% Verified
What is risk financing in the context of risk management?
Risk financing involves strategies for managing the financial impact of risks, including
insurance, self-insurance, and other financi...
RMIN 4000 Test 2 Daniel Brown
Questions and Answers | Latest Update |
2024/2025 | 100% Verified
What is risk financing in the context of risk management?
✔✔ Risk financing involves strategies for managing the financial impact of risks, including
insurance, self-insurance, and other financial mechanisms.
How does self-insurance differ from traditional insurance?
✔✔ Self-insurance involves setting aside funds to cover potential losses instead of purchasing an
insurance policy from an external insurer.
What is the role of risk retention in an organization’s risk management strategy?
✔✔ Risk retention involves accepting the financial consequences of certain risks as part of an
organization’s overall strategy to manage risk.
What is a stop-loss provision in insurance policies?
✔✔ A stop-loss provision limits the amount of total loss an insurer will pay, protecting against
extremely high claims.
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, What is the concept of risk transfer in risk management?
✔✔ Risk transfer involves shifting the financial burden of risk from one party to another,
commonly achieved through purchasing insurance.
What is moral hazard in relation to insured parties?
✔✔ Moral hazard occurs when insured parties change their behavior and take on greater risks
because they do not bear the full cost of those risks.
What is the purpose of actuarial science in insurance?
✔✔ Actuarial science involves using statistical methods and models to assess risk and determine
appropriate insurance premiums.
What does loss adjustment expense refer to in insurance?
✔✔ Loss adjustment expense refers to the costs incurred by an insurer in investigating and
settling claims.
What is catastrophic risk in the insurance industry?
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