Ampp Practice Test & Exam Prep

Which risk characteristic is most important for a loss exposure to be well suited to private insurance?

The insured should be able to control the timing of the loss The loss amount should be impossible to estimate The loss should be certain to occur during the policy year The loss should be fortuitous from the insured's standpoint

Correct Answer:

The loss should be fortuitous from the insured's standpoint

Explanation:

Insurance is designed primarily for fortuitous losses rather than losses that are certain or deliberately controlled by the insured.

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