Match the type of risk with its correct definition:
-_____ Insurance risk
A) The risk that the counterparty to the insurance contract will cancel the coverage earlier or later than expected when the contract price was determined
B) The risk that administrative costs to service the contract will unexpectedly increase
C) The risk arising from uncertainties other than financial risk that is transferred from the holder of an insurance contract to the issuer
D) The possibility that future changes in a specified interest rate, financial instrument price, commodity price, foreign exchange rate, index of prices or rates, credit rating or credit index or other variable, will impact expected cash flows

Question

Quizplus · Accepted Answer

Insurance risk is specifically related to uncertainties other than financial risk that are transferred from the policyholder to the insurance company. This includes risks such as the likelihood of an insured event occurring and the severity of the event if it does occur.

Match the Type of Risk with Its Correct Definition