Scribd Logo
Upload

Welcome to Scribd!

  • 8 views

    Tutorial Week 2 Summary

    Uploaded by

    Samridhi Dokwal
    1. Insurance provides certainty about losses by spreading risks across large numbers of individuals through premiums, defines losses that are definite, measurable, and accidental rather than catastrophic, and allows for optimal capital utilization. 2. It has economic and social benefits, exists in private, social, and public sectors, and manages risks through expected value, minimizing maximum regret, and rules around affordable risk, odds consideration, and risk-reward assessments. 3. Risk transfer and retention decisions are informed by principles of large losses, optional coverage, financing costs, taxes, and agent/insurer selection.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content

    You might also like

    Tutorial Week 2 Summary

    Uploaded by

    Samridhi Dokwal
    8 views3 pages
    1. Insurance provides certainty about losses by spreading risks across large numbers of individuals through premiums, defines losses that are definite, measurable, and accidental rather than catastrophic, and allows for optimal capital utilization. 2. It has economic and social benefits, exists in private, social, and public sectors, and manages risks through expected value, minimizing maximum regret, and rules around affordable risk, odds consideration, and risk-reward assessments. 3. Risk transfer and retention decisions are informed by principles of large losses, optional coverage, financing costs, taxes, and agent/insurer selection.

    Original Description:

    Copyright

    © © All Rights Reserved

    Available Formats

    PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Report this Document
    1. Insurance provides certainty about losses by spreading risks across large numbers of individuals through premiums, defines losses that are definite, measurable, and accidental rather than catastrophic, and allows for optimal capital utilization. 2. It has economic and social benefits, exists in private, social, and public sectors, and manages risks through expected value, minimizing maximum regret, and rules around affordable risk, odds consideration, and risk-reward assessments. 3. Risk transfer and retention decisions are informed by principles of large losses, optional coverage, financing costs, taxes, and agent/insurer selection.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    8 views3 pages

    Tutorial Week 2 Summary

    Uploaded by

    Samridhi Dokwal
    1. Insurance provides certainty about losses by spreading risks across large numbers of individuals through premiums, defines losses that are definite, measurable, and accidental rather than catastrophic, and allows for optimal capital utilization. 2. It has economic and social benefits, exists in private, social, and public sectors, and manages risks through expected value, minimizing maximum regret, and rules around affordable risk, odds consideration, and risk-reward assessments. 3. Risk transfer and retention decisions are informed by principles of large losses, optional coverage, financing costs, taxes, and agent/insurer selection.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as pdf or txt
    of 3

    UNSW Business School

    RISK5001
    Fundamentals of Risk and Risk Management

    Topic 2: Insurance and Risk


    Tutorial Summary
    Insurance
    Insurance

    Nature &
    functions

    Definition: Individual & society

    Economic Fields of
    Elements
    contribution insurance

    1. Creates certainty about the


    1. Large numbers of exposure units 1. Private insurance
    burden of loss
    2. Definite and measurable loss 2. Social insurance
    2. Spreading losses that do occur
    3. The loss must be fortuitous 3. Public benefit guarantee
    3. Provides for an optimal utilization
    4. The loss must not be catastrophic programs
    of capital
    Risk Management Applications
    Expected value
    Decision
    making
    Minmax regret

    1. Don't risk more than you can afford to lose


    Rules of RM 2. Consider the odds
    3. Don't risk a lot for a little

    1. Large-loss principle
    2. Insurance as a last resort – optional coverages
    Transfer or
    3. Cost of financing risk
    retention
    4. Tax treatment of premiums and losses
    5. Selecting agent and insurer

    You might also like