UNDERSTANDING WHAT You HAVE REAL 1 Personal risk management

UNDERSTANDING WHAT You HAVE REAL 1. Personal risk management is necessary because (a) our goals may be unrealistic (b) we may have invested only in stocks (c) life is uncertain (d) assets accumulate over a lifetime. 2. Risk management involves identifying risks that may occur and (a) taking steps to reduce the monetary costs that may result (b) avoiding accidents (c) staying on the job (d) reading the financial news every day. 3. Just as an umbrella protects us when it rains, insurance () reduces the risk of an adverse event happening (b) prevents adverse events from happening (c) helps individuals avoid accidents (d) protects an individual when a financial loss occurs. 4. Insu rance companies are (a) all alike (b) well-managed organizations (c) not-for-profit institutions (d) businesses hoping to make a profit. 5. You should buy insurance (a) to fit your individual needs (b) to the limit the insurance company is willing to sell to you (c) strictly as an investment (d) according to the examples set by your neighbors or friends.

Solution

Question 1

Answer: C life is uncertain. Personal risk management is the managment of risk according to individual needs. Life is unpredicatable so we have to prepared for this.

Question 2

Answer A. Identifying and managing risks to avoid monetary loss.

Question 3

d. Insurance mitigates monetary loss to life and property.

Question 4

d. Insurance are for profit companies.

Question 5

a. Insurance should fit personal requirements.