Aqua Sprinkler Systems experienced increasing sales for several years. The firm expanded its product offerings, and now serves both commercial and residential customers. Which of the following situations would be considered an uninsurable risk for Aqua Sprinkler Systems?
A) a fire that destroys its warehouse
B) employee sues company due to injury on the job
C) equipment theft that causes work downtime
D) drought-resistant grass technology that disrupts sales

Question

Quizplus · Accepted Answer

An uninsurable risk is one that insurance companies will not cover. When new technologies become marketable, there is always the risk that products that were used for the same purpose become obsolete. Speculative risks are not insurable. Pure risks are usually insurable.

Aqua Sprinkler Systems Experienced Increasing Sales for Several Years