insurable risk

Definition

A risk that conforms to the following criteria: The possible loss must be plainly explained; the loss must be accidental and significant enough to be considered a hardship to the insured; the loss must also be part of a similar group of risks, so as to make the loss foreseeable; the loss must not occur at the same time as multiple others; and finally, the insurer must be able to compute the probability of a loss and a realistic cost for the insurance.

Use insurable risk in a sentence

It was an insurable risk and that meant that it was a risk worth taking and everything was going to be okay.

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The insurance company balked at paying the claim because even though the property was an insurable risk, the police still hadn't ruled out arson.

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A 20 year owner of a property slipped after getting out of his pool, due to a damaged block, and filed a claim with his insurance company because he believed it was an insurable risk.

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