Idiosyncratic Risk Is the

question 40

Multiple Choice

Idiosyncratic risk is the

• A) uncertainty associated with the entire economy.
• B) uncertainty associated with specific companies.
• C) risk associated with adverse selection.
• D) risk associated with moral hazard.

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Definitions:

Economic Loss

The monetary loss suffered by an individual or entity, which can result from a wide range of factors, including breach of contract, negligence, or market fluctuations.

Title Insurance

Insurance that protects real estate owners and lenders against any property loss or damage they might experience because of liens, encumbrances, or defects in the title to the property.

Policy

A course or principle of action adopted or proposed by an organization or individual, often serving as a guideline for decisions.

Incontestability Clause

The incontestability clause is a provision in life insurance policies that limits the time within which the insurer can contest or challenge the validity of the policy, typically after it has been active for two years.