As an insurance provider, it’s important to realize that, in most parts of the U.S., levels of insurance risk change with the changing of the seasons. One might assume that the riskiest time of year to be out driving on the highways is winter because of the inclement weather and harsh driving conditions. Insurers know, […]
Category: Insurance Risk
Various Types of Insurance Risk
Risk is best defined as exposure to the chance of an event happening that creates loss or the degree of probability of such a loss occurring. This could be loss of life, injury, or financial loss. It’s neither predictable nor inevitable but is always a possibility. Insurance risk is this possibility for loss that’s transferred […]
Risk VS. Reward
In the financial world, an important concept to consider when doing business is “risk vs. reward.” It’s an important concept to understand whenever an investment is being made. Financial institutions take risks whenever they lend money to an individual or a business. The risk is that the loan will be repaid as agreed. If so, […]
How Insurance Risk Factors Into Insurance Underwriting
As an insurance underwriter, your number one concern when writing a policy is the level of insurance risk you perceive being represented by the proposed insured. Different Policy Coverages for Different Risks If you’re an underwriter handling primarily life insurance policies, the main risk you’re faced with is how likely the insured is to die […]
Insurance Risk Levels and Types
Risk, simply stated, is the probability that an event could occur that causes a loss. For an insurance company, risk will determine whether or not they may have to pay a claim. The amount of perceived risk being underwritten by an insurer will be used by you, the underwriter, to decide whether or not an insurance […]
Heightened Insurance Risk Posed By Climate Change
Natural disasters and climate change have been on peoples’ minds for several years and, if you’re involved in the P&C insurance industry, is a main concern affecting insurance risk. Natural disasters have been increasing in both frequency and severity, which means insurance payouts on policies covering these types of events have also increased in frequency and […]
Looking at Insurance Risk as an Insurance Underwriter
As an insurance company policy underwriter, you have a number of important jobs that will help to determine the profitability of your company. Job number one is to determine the level of insurance risk represented by a proposed policy being considered. All insurance contracts, which are risk-sharing agreements between an insurer and an insured, are […]
Covered and Uncovered Home Insurance Risk Types
From an insurance risk perspective, the year 2021 was one of the worst in recent history for the insurance industry. In addition to the ongoing health claims caused by the Covid-19 Pandemic, now over two years running, insurers have also had to deal with an unprecedented number of worldwide natural disasters, including: Earthquakes (Haiti) Floods (Germany, […]
Understanding Insurance Risk for Accurate Policy Writing
If you’ve ever watched a Grand Prix motorcycle racer whipping around the curves with parts of his body mere inches from the track surface, you may have wondered why anyone would willingly take such an obvious risk. When looking at this scene from an insurance risk perspective, you’ll see the risk of: Damaging/destroying the GP […]
Various Types of Insurance Risk
Insurance risk is the threat of a future financial loss that an insurer is willing to share with an individual or entity facing that threat. Insurance spreads the risks of policyholders among those policyholders by incorporating the Law of Large Numbers. It’s risk-sharing with other policyholders within the same class and is based on the probability of loss. […]
