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

The Right Time to Buy an Annuity

The Right Time to Buy an Annuity

Learn how timing can influence your decision about if and when to buy.

A Deep Dive Into Deductibles

A Deep Dive Into Deductibles

Your deductible does more than lower your premium. Here's what it's actually telling you about your coverage.

Making Sense Of A Home Warranty

Making Sense Of A Home Warranty

Understanding the value of a home warranty.