COMMERCE 4FP3 Chapter Notes - Chapter 8: Arson, Strict Liability, Risk It
6 Jul 2018
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Life insurance replaces income lost if the policyholder dies. Automobile insurance covers property and personal damage caused by the policyholder"s car. Home insurance covers the policyholder"s place of residence and its associated financial risks, such as damage to personal property and injuries to others. Insurance company: a risk sharing firm that assumes financial responsibility for losses that may result from an insured risk. Under the policy, the insurance company agrees to assume the risk for a fee (the premium) that the person (the insured or policyholder) pays periodically. Premium: the amount of money a policyholder is charged for an insurance policy. Policyholder: a person who owns an insurance policy. Risk: chance or uncertainty of loss, may also mean the insured . Hazard: a factor that increases the likelihood of loss through some peril. Personal risks are the uncertainties surrounding loss of income or life due to premature death, illness, disability, old age or unemployment (they are pure risks)
