Week 3

Question 1

Loss exposures

Answer 1

Risk manager/ Risk management team (company/institution)

actuary/ risk underwriter (insurance/ reinsurance)

Question 2

function of loss exposures

Answer 2

to predict the major part of your costs/ losses and related expenses
(using historical data/ experienced/judgment)

Question 3

analysis

Answer 3

frequency

severity

Question 4

frequency

Answer 4

refers to the probable number of losses that may occur during some given time period
(probability one event will happen)

Question 5

severity

Answer 5

the probable size of the losses that may occur during some given time period

Question 6

asbestos example

Answer 6

was used in everything across the multiple industries - caused serious illnesses

liability: knew it was harmful and kept using it
- the risk manager should have halted production and recall.

Question 7

analysing loss exposure

Answer 7

things we use every day that we don’t know the long term effects of.
frequence loss exposure is easier to predict (more historical data)