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

What is a Premium?

What is a Premium?

Do you know what a Premium is?

6 Tips to Help You Prepare for Natural Disasters

6 Tips to Help You Prepare for Natural Disasters

Disaster can strike at any time. These six tips can ensure you’re prepared when it does.

Forecast

Forecast

This short video helps explain why markets can be as unpredictable as the weather.