New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

Chapter 2 lecture

by: dambeck Notetaker

Chapter 2 lecture INS 210

Marketplace > Insurance > INS 210 > Chapter 2 lecture
dambeck Notetaker

View Full Document for 0 Karma

View Full Document


Unlock These Notes for FREE

Enter your email below and we will instantly email you these Notes for Principles of Insurance

(Limited time offer)

Unlock Notes

Already have a StudySoup account? Login here

Unlock FREE Class Notes

Enter your email below to receive Principles of Insurance notes

Everyone needs better class notes. Enter your email and we will send you notes for this class for free.

Unlock FREE notes

About this Document

Underlined words are important to know to go onto chapter 3 and for exam.
Principles of Insurance
Dr. Costello
Class Notes
Insurance, business, principles of insurance




Popular in Principles of Insurance

Popular in Insurance

This 2 page Class Notes was uploaded by dambeck Notetaker on Sunday January 31, 2016. The Class Notes belongs to INS 210 at a university taught by Dr. Costello in Spring 2016. Since its upload, it has received 21 views.

Similar to INS 210 at University

Popular in Insurance


Reviews for Chapter 2 lecture


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 01/31/16
Chapter 2 Insurance- the pooling of fortuitous losses = taking a pool to figure out what unforeseen accidents can occur that will cause a loss. Indemnify=money Basic Characteristics of Insurance:  Pooling of Losses- spreading losses incurred by the few over the entire group o Law of Large Numbers- the bigger the number of the group being pooled the more accurate the probability of losses that will occur.  Payment of Fortuitous Losses- pays for an unexpected loss that occurs as a result of chance  Risk Transfer- the insurer is transferred a pure risk from the insured, usually in a good financial position  Indemnification- the insured (people paying for insurance) is reimbursed to their approximate financial position from before the loss occurred. Characteristics of an Ideally Insurable Risk: a risk that meets criteria for efficient insurance  Large number of exposure units o Use Law of large numbers to predict average loss  Accidental and unintentional loss o Assure random occurrence of events. (i.e. natural disasters)  Determinable and measurable loss o Decide how much should be paid for a loss  No catastrophic loss o Reinsurance- “dispersing coverage over a large geographic area, or using financial instruments, such as catastrophe bonds” o =an insurance company disperses insurance coverage to other insurance companies that buy this insurance to reduce the likelihood of a large pay out resulted by an insurance claim.  Calculable chance of loss o Establish a premium that is sufficient to pay all claims and expenses o Yields a profit during the policy period Adverse Selection- is the tendency of persons with a higher-than-average chance of loss to seek insurance at standard rates. Private Insurance:  Life and health  Property and Liability  Personal lines- insure real estate and personal property of individuals or provide protection against legal liability  Commercial lines- covers business firms, nonprofit organizations, and government agencies Government Insurance  Social Insurance programs  Insurance programs found at the federal and state level Insurance vs. Gambling= depends on who Social Benefits of Insurance  Indemnification for loss  Reduction of Worry and Fear  Source of Investment Funds  Loss prevention  Enhancement of Credit Social Costs of Insurance  Cost of Doing Business- expense loading is the amount needed to pay all expenses  Fraudulent Claims  Inflated Claims “Higher premiums to cover additional losses reduce disposable income and consumption of other goods and services.”


Buy Material

Are you sure you want to buy this material for

0 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."

Allison Fischer University of Alabama

"I signed up to be an Elite Notetaker with 2 of my sorority sisters this semester. We just posted our notes weekly and were each making over $600 per month. I LOVE StudySoup!"

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.