Society costs for operating an insurance system

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Answer the following question.

Discuss the validity of the following statement: Diversification is a useful technique for handling speculative risk, but it cannot be used to handle pure risk effectively.

From the viewpoint of an advocate for ERM, explain why the traditional "silo" approach to corporate risk management is flawed.

Why are the costs of insured losses not included among society's costs for operating an insurance system?

Describe how the premiums charged by insurers are affected by the returns available to the holders of different types of investments.

Reference no: EM132798039

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