Chapter 21 Review

It is possible to protect yourself from the consequences of pure risks.

• True
• False

You can buy insurance on your neighbor's home.

• True

• False

Factories begin laying off workers during the decline period of the business cycle.

• True
• False

Factories begin laying off workers during the decline period of the business cycle.

• True

• False

Insurance is a way to enrich policyholders; it is to put them in a better financial position than they were in before the loss or damage.

• True
• False

Some risks are not serious enough to insure.

• True
• False

Risk transfer is the process of accepting the consequences of risk.

• True
• False

Risk transfer is the process of accepting the consequences of risk.

• True
• False

Generally, the _____ the deductible, the ____ the insurance premium.

• higher; higher
• higher; lower
• lower; lower

The premiums for group plans are usually considerably ______ than for individual plans.

• higher
• the same
• lower