Multiple choice

Which of the following statements is correct?

  1. Insurance is a kind of investment.

  2. Insurance is nothing but a gamble.

  3. Insurance is risk transfer of pooling of similar risks.

  4. Insurance is nothing but a savings scheme.
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

The pooling principle provides protection against the economic loss arising as a result of one’s untimely death and providing security of investment through pooling and evening out of financial risk as well.

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