The Agents View
In insurance it is the agents responsibility to collect the necessary informations to conclude on the needs of
In doing so the agent will gather information on what would be a considerable risk to the insured and his/her
If there is a entity which is potentially valuable to the insured and runs the possibility of being a tough loss to
then, then it should be insured against risk.
If there is a slight opening for loss to the insured because of depreciable value and is considered a means of
income in the basic sense then by all means it should also be insured.
The presentation which the agent will provide any lead or possible client is that of clarifying ones core
valuables to protect from loss. This will most deﬁnatly have the client speaking your language.
kind of Risk
Deﬁning this term is like revealing the utmost important of values in insurance. Risk is the uncertainty or the
chance that a loss will occur. In insurance the risk is death or injury.
The two types of risk which are deﬁned are called Pure and Speculative. In insurance the only kind of risk
which is covered would be pure risk.
Reason for this being that insurance runs on an indemnic principle. wherein that there are no proﬁt to be
made from a loss with speciﬁc
The other type of risk is deﬁned as a speculative risk. In this deﬁnition it is explained that There is a
possibility for there to be a loss, but there is also the same amount of chance that there will be a positive proﬁt
in production, many time not meeting the requirements for underwriters to establish a policy.
This action is in the protective interest of the public in that the entire purpose which insurance is to restore
what a loss might have expensed the insured. A speculative risk can proﬁt, thus useless for an insurance
Categorizing the risk has a speciﬁc purpose in determining the cost to the insured for the service of insurance.
For example in Life insurance knowing the life age, past medical history, occupation would aid in classifying
the service and the price on this service.
The mentioned categories are called the exposure units. They represent the physical depreciation which
would be presented to the asset regularly.