Morris Company Self-Insures Its Workers Compensation Loss Exposure

question 51

Multiple Choice

Morris Company self-insures its workers compensation loss exposure.The risk manager of Morris Company is concerned about the possible impact of a single catastrophic claim.She decided to set a retention limit of $500,000 per-claim,and to purchase insurance that will be begin to pay once Morris Company has paid $500,000 on a single claim.The insurance the risk manager purchased is called

• A)captive insurance.
• B)excess insurance.
• C)primary insurance.
• D)umbrella insurance.

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Definitions:

Interactional Justice

The fairness perceived in the communication processes used during the implementation of organizational procedures.

Downsizing Decision

The process of reducing an organization's workforce to improve efficiency or reduce costs.

Interpersonal Treatment

The behavior and manner in which individuals interact and treat each other within an organization, impacting the work environment and employee relations.

Job Loss

The termination of employment due to reasons such as downsizing, restructuring, or company closure, resulting in unemployment for affected individuals.