Insurance Fundamentals
Part 1
Insurance is the part of management where we try to control risks. We can't control them all so we try to control the effects of the risks.

There are four steps in this process:

Identify the risks:

1. Property - the loss of the value of our property; the more property I own, the greater the risk
2. Personal - loss of income or the expenses due to death, illness, injury or disability
3. Liability - most difficult to assess; where you may cause damage to another person or their property

Measure risks:

1. Look at the potential for loss
2. Measure how likely it is to happen

Rank risks:

1. Decide which are most important to you

Manage the risks:

1. Retain
2. Avoid
3. Prevent
4. Transfer

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