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Types of Risk

Risk Management

Insurance Terminolo

gy

Property & Liability

Insurance

Health and Life

Insurance

Chance of loss with no chance of gain

What is

Pure risk?

The type of risk that may result in a gain or loss.

What is speculative risk ?

Pure risk faced by a large number of people and the

amount of loss can be predicted.

What is

insurable risk?

Chance of loss or harm to personal or real

property.

What is property risk?

Chance that loss may occur when your actions result in injuries to others or damages to someone

else’s property

What is liability risk?

An organized strategy for

controlling financial loss from pure and

insurable risks.

What is

risk management?

The first step in a risk management/assessme

nt strategy.

What is “identify risks” ?

Lowering the chance for loss by not engaging in

activities that could result in loss.

What is risk avoidance?

Taking precautions to reduce the chance of loss

or severity of loss

What is risk reduction?

Accepting the consequences of risk and the financial burden.

What is risk assumption?

Spreading the risk to protect assets and income.

What is insurance?

A specified amount, that you are

responsible for, subtracted from covered losses.

What is a deductible?

Sums of money to be paid for specific types

of losses under the terms of the policy.

What are benefits?

A policyholder’s request for

reimbursement for a loss under the terms of the

insurance policy.

What is a claim?

A written amendment to an insurance policy.

What is an endorsement?

Protection from loss regarding your personal

property and liability risks when you rent an

apartment or a home.

What is renter’s insurance?

Protects the insured, in the event of a car

accident, against claims for bodily injury to

another person and damage to another person’s property.

What is liability coverage?

Protects your own car against damages from

accidents or vehicle overturning.

What is collision coverage?

Drivers receive reimbursement for their expenses from their own insurer no matter who is

responsible for the accident.

What is no-fault insurance?

A personal catastrophe policy which supplements your basic auto and

property liability coverage.

What is umbrella liability insurance?

The person named in a life insurance policy to receive

benefits.

What is a beneficiary?

The death benefit of a life insurance policy.

What is the face amount?

Health insurance coverage that pays for your hospital room and board and prescription

drugs during your hospital stay.

What is basic health insurance?

The most common form of life insurance

that only lasts for a specified period of

time.

What is term life insurance?

When a family has more than one insurance plan the insurers will share the costs of the claim, not

to exceed 100% of allowable expenses.

What is false?

When a family has more than one insurance plan the

insurers will share the costs of the claim, not to exceed 100%

of allowable expenses.

What is coordination of

benefits?

Final Jeopardy

The nationwide claims database which details information of claims filed.

Comprehensive Loss Underwriting Exchange