Fair Insurance Is a Contract Between an Insurer and a Policyholder

question 51

Multiple Choice

Fair insurance is a contract between an insurer and a policyholder in which.

• A) the value of the contract to the policyholder is negative.
• B) the value of the contract to the policyholder is zero.
• C) the risk of the contract to the policyholder is diversifiable.
• D) the value of the contract to the policyholder is positive.

Recognize the trend of outsourcing as a significant strategy in reshaping management.

Understand the differences between outsourcing, alliances, partnerships, and joint ventures.

Analyze the potential losses (e.g., KSAOs) due to outsourcing.

Differentiate between minor and major functions or activities for outsourcing.

---

Definitions:

Liability of Directors

Legal responsibility held by company directors for actions or decisions made in the course of carrying out their duties.

Capital Structure

The mix of various forms of external funds and equity that a firm uses to finance its operations and growth.

Board of Directors

A group of individuals elected by shareholders to oversee the management and make key policy and decision-making for a corporation.

Honk

A sound made by vehicles as a signal or warning.