In General, Aggregate Losses Must Be Predictable in Advance for an Insurance

question 50

True/False

In general, aggregate losses must be predictable in advance for an insurance system to work properly.

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Definitions:

Conservation of Mass

A fundamental principle of classical physics that states mass in an isolated system is neither created nor destroyed by chemical reactions or physical transformations.

Chemical Reaction

A process that involves the transformation of one or more substances into one or more different substances through the breaking and forming of chemical bonds.

Open System

A system in which both energy and matter can be exchanged with its surroundings.

Mass

A physical property that reflects the amount of matter contained in an object, often measured in kilograms or grams.