The exposure to significant, measurable accidental loss from identifiable perils. The exposure, while not catastrophic, must be shared by a sufficient number of potential insureds so that the cost of loss for one can be measured and affordably shared throughout the market.
a financial loss that can be determined
Risks for which it is relatively easy to get insurance.
An insurable risk must meet these qualifications: The loss insured must be able to be defined. The loss must have occurred out of accidental or act-of-God circumstances. To be insured, the loss, if it transpires, must cause a hardship. The risk involved must not be a highly unlikely occurrence. The risk must not be subject to the same loss at the same time as a large number of other risks. The loss must be financially calculable by a company. The probability of loss must be calculable.
A risk that meets the following criteria: 1. The insured loss must have a definite time and place; 2. The insured event must be accidental; 3. The insured must have an insurable interest in the subject of coverage; 4. The insured risks must belong to a sufficiently large group of homogeneous exposure units to make losses predictable; 5. The risk must not be subject to a catastrophic loss where a large number of exposure units can be damaged or destroyed in a single event; 6. The coverage must be provided at a reasonable cost; 7. The chance of loss must be calculable.
part icular type of risk which can be covered by an insurance policy. [D00851] RMH
A risk which meets most of the following requisites: (1) The loss insured against must be defined; (2) It must be accidental; (3) It must be large enough to cause hardship to the insured; (4) It must belong to a homogenous group of risks large enough to make losses predictable; (5) It must not be subject to the same loss at the same time as a large number of other risks; (6) The insurance company must be able to determine a reasonable cost for the insurance; (7) The insurance company must be able to calculate the chance of loss.
Someone an insurance company is willing to insure based upon the company's assessment of the risk. See Uninsurable Risk.
The conditions that make a risk insurable are (a) the peril insured against must produce a definite loss not under the control of the Insured, (b) there must be a large number of homogeneous exposures subject to the same perils, (c) the loss must be calculable and the cost of insuring it must be economically feasible, (d) the peril must be unlikely to affect all Insureds simultaneously, and (e) the loss produced by a risk must be definite and have a potential to be financially serious.
An insurable risk is a risk that meets the ideal criteria for efficient insurance. The concept of insurable risk underlies nearly all insurance decisions.
