Insurance

What is Risk?

Risk

[risk]

noun

1.

Risk is the likelihood that an insured event occurs, that is, an event in which the insurance company is likely to pay out a Claim. Insurance companies use Risk when determining whether to insure a home, car, or individual, and when setting Premiums. People with lower Risk generally pay lower rates, and people with higher Risk generally pay higher rates.

Have A Question About This Topic?

Thank you! Oops!

Related Content

How Swimming Pools Affect Your Homeowners Policy

How Swimming Pools Affect Your Homeowners Policy

When the weather warms up, it’s important to remain up to date when it comes to your insurance coverage—especially if you own a pool.

Estate Management Checklist

Estate Management Checklist

Is your estate in order? This short quiz may help you assess your overall strategy.

Gun Ownership and Your Homeowners Policy

Gun Ownership and Your Homeowners Policy

Gun owners need to make sure that their homeowners policy covers the full value of their firearm(s) as personal liability.