All of the Following Statements About Risk Retention Are True

question 59

Multiple Choice

All of the following statements about risk retention are true EXCEPT

• A)It may be used intentionally if commercial insurance is unavailable.
• B)It may be used passively because of ignorance.
• C)Its use is most appropriate for low-frequency,high-severity types of risks.
• D)Its use results in cost savings if losses are less than the cost of insurance.

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Definitions:

Probability

The measure of the likelihood that an event will occur, expressed as a number between 0 and 1.

Observed Findings

Refers to results or outcomes that have been noticed and recorded from scientific experiments or observational studies.

Inferential Statistics

Statistical methods that allow researchers to make conclusions about populations based on samples.

Mathematical Statistics

The application of mathematics to the collection, analysis, interpretation, and presentation of numerical data.