How does an insurance policy help mitigate risk?
A)Individuals pay to reduce uncertainty in some aspect of their lives.
B)Individuals are paid very large sums of money if they encounter any risk.
C)Individuals pay money to ensure they don't experience any risk.
D)Individuals pay a fee in exchange for the insurance company covering all expenses associated with risky behavior.

Question

Quizplus · Accepted Answer

Insurance policies help mitigate risk by allowing individuals to pay a premium to reduce uncertainty in some aspect of their lives, not by preventing risk or covering all expenses associated with risky behavior.

How Does an Insurance Policy Help Mitigate Risk