With Respect to the Ability to Manage Risk Through Insurance,which

question 60

Multiple Choice

With respect to the ability to manage risk through insurance,which of the following is a known result of the Enron and WorldCom scandals?

• A) Directors and officers must now bear the brunt of high deductibles.
• B) The insurance premiums for public companies have tripled.
• C) The insurance premiums for public companies have doubled.
• D) Directors' and officers' liability insurance is now unavailable.

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Definitions:

Rate Regulation

The governmental or regulatory authority's control over the pricing of certain services and products.

Public Utility Managers

Individuals responsible for overseeing the operations and maintenance of public utilities, ensuring services like water, gas, and electricity are provided efficiently.

Asset Base

The total value of all assets owned by an individual or entity, which can include cash, investments, property, and other tangible and intangible items.

Capital Adequacy Ratio

A measure used by banks to ensure they have enough capital to cover their risks and continue operating in case of losses.