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How can a company experience risk?

Updated: 9/23/2023
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10y ago

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Risk is, by definition, the likelihood or non-likelihood of a financial loss occuring. The financial loss can be in terms of the loss of money, damage to property, or any other occurrence that has a financial impact upon the business.

Insuring is the process of transferring the risk of loss from the entity that bears the risk to an insurer. The insurer agrees to assume the risk in return for a premium. The terms and extent of the transfer of risk is set forth in the insurance contract.

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Q: How can a company experience risk?
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