📢 Too many exams? Don’t know which one suits you best? Book Your Free Expert 👉 call Now!

    Question

    Insurance is primarily a method of:

    A Avoiding risks altogether Correct Answer Incorrect Answer
    B Pooling and sharing losses among a group Correct Answer Incorrect Answer
    C Maximizing profit from uncertain events Correct Answer Incorrect Answer
    D Preventing unforeseen events Correct Answer Incorrect Answer
    E None of the above Correct Answer Incorrect Answer

    Solution

    Explanation: The correct answer is B. Pooling and sharing losses among a group. Insurance works by collecting premiums from a large pool of insured individuals and using these funds to compensate those who suffer covered losses.

    Practice Next
    More Insurance Awareness Questions
    ask-question