Week Two Flashcards
Worry
Emergency Funds
loss of certain goods/services
Burden of Risk on Society
Outlays to Reduce Risk
Opportunity Cost
Expenses for potential loss
Costs of Risk
The process of handling Loss Exposures
Risk Management
A Situation where a loss is possible
Loss Exposure
Anxiety Reduction
Fulfilling Legal Requirements
Pre-Loss RM
Firm Survival
Continuation of Growth
Social Responsibility
Post-Loss RM
Identify Loss Exposure
Analyze Loss Exposure
Select technique to manage risk
Implement and review
RM Process
Lowering Frequency of loss
Loss prevention
Lowering Severity of Loss
Loss reduction
Avoidance
Loss control
Risk Control
Retention
Transfer
Risk Financing
Pooling of fortuitous losses
Insurance
Accidental, non-intentional loss
Large # of Loss exposures
Economically feasible premium
Requirements to insure risk
When people with higher-than-average chance
of loss seek insurance at standard rates
Adverse Selection
