Some Businesses Will Set Aside Money to Cover Routine Losses

question 27

Multiple Choice

Some businesses will set aside money to cover routine losses and buy "catastrophe" policies to cover big losses. This is an example of which of the following?

• A) Avoiding the risk
• B) Self-insuring against the risk
• C) Reducing the risk
• D) A loss-prevention program

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Definitions:

Uniform Transfer to Minors Act

The Uniform Transfers to Minors Act (UTMA) is a law that allows assets to be transferred or gifted to minors without the need for a formal trust.

Custodianship Terminate

The process by which a custodial arrangement, where one party holds property or assets for the benefit of another, comes to an end.

Abandoned Shipwreck Act

A U.S. federal law that asserts state ownership and preservation rights over abandoned shipwrecks located in its waters.

Law of Finds

A legal doctrine that governs the rights to ownership of property that has been unclaimed and discovered.