Property Damage Risk:
a) It includes the risk of economic loss to automobile, home or personal belongings due to
accident, theft, fire, or natural disaster.
b) Property insurance provides a benefit if insured items are damaged or lost because of
various specified perils, such as fire, theft, or accident.
Liability Risk:
a) It includes the risk of economic loss resulting from your being held responsible for
harming others or their property.
b) Liability insurance provides a benefit payable on behalf of a covered party who is legally
responsible for unintentionally harming others or their property.
Personal Risk:
a) It includes the risk of economic loss associated with death, poor health, and outliving
one’s saving.
b) Life and health insurers sell insurance policies to provide financial security from personal
risk.
c) To manage a personal risk, insurers use a concept called Risk Pooling.
d) With risk pooling, individuals who face the uncertainty of a particular economic loss,
transfer the risk to an insurance company.