The Idea of an Insurance Company "Pooling" the Risk Means

question 52

Multiple Choice

The idea of an insurance company "pooling" the risk means that

• A) the risk is completely eliminated from society.
• B) the insurance company requires buyers to pay a large deductible.
• C) the risk is spread over a large population.
• D) the insurance company insists on a pooling equilibrium.
• E) moral hazard and adverse selection are eliminated.

---

Definitions:

Episodic Autobiographical Amnesias

Episodic autobiographical amnesias refer to the inability to recall personal events from one’s life, affecting the episodic aspect of autobiographical memory.

Hippocampus

A major component of the brains of humans and other vertebrates, playing critical roles in the consolidation of information from short-term memory to long-term memory and spatial navigation.

Temporal Lobes

The temporal lobes are located on the sides of the brain, important for processing auditory information, and are involved in speech, memory, and emotional responses.

Temporal Lobes

Parts of the brain located on the sides of the brain responsible for processing sensory input into derived meanings for the appropriate retention of visual memory, language comprehension, and emotion association.