Difference between pools and insurance
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1. Insurance transfers risk from the insured to the insurer in exchange for the
premium payment. In pooling, losses are shared by pool members
2. The insurer provides additional resources to ensure that funds are
available after a loss.
Key Elements of Risk
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1. Uncertainty
2. Possibility
,Loss Data Should Be
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1. Relevant
2. Complete
3. Consistent
4. Organized
Government insurance programs vary based on
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1. their purpose
2. the level of government involvement
3. whether the program is run at the federal or at the state level.
The most the insurer will pay is the lesser of
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1. The applicable policy limit
2. The compensable amount of the loss
As more participants join the pool, the pooling arrangement has two effects on each
participant's probability distribution.
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, 1. The variability of losses is reduced
2. The distribution of losses becomes less skewed
Special Types of Group Captives
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1. Risk Retention Group (RRG)
2. Rent a captive
3. Protected Cell Company (PCC)
Approaches used in property insurance to value property
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1. actual cash value
2. replacement cost
3. agreed value approach
4. functional value
Courts Take Three Approaches to ACV
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1. Replacement cost minus depreciation
2. market value
3. the braod evidence rule
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1. Insurance transfers risk from the insured to the insurer in exchange for the
premium payment. In pooling, losses are shared by pool members
2. The insurer provides additional resources to ensure that funds are
available after a loss.
Key Elements of Risk
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1. Uncertainty
2. Possibility
,Loss Data Should Be
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1. Relevant
2. Complete
3. Consistent
4. Organized
Government insurance programs vary based on
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1. their purpose
2. the level of government involvement
3. whether the program is run at the federal or at the state level.
The most the insurer will pay is the lesser of
Give this one a try later!
1. The applicable policy limit
2. The compensable amount of the loss
As more participants join the pool, the pooling arrangement has two effects on each
participant's probability distribution.
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, 1. The variability of losses is reduced
2. The distribution of losses becomes less skewed
Special Types of Group Captives
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1. Risk Retention Group (RRG)
2. Rent a captive
3. Protected Cell Company (PCC)
Approaches used in property insurance to value property
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1. actual cash value
2. replacement cost
3. agreed value approach
4. functional value
Courts Take Three Approaches to ACV
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1. Replacement cost minus depreciation
2. market value
3. the braod evidence rule
