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Sources of risk:

  1. Natural risk- Caused by unpredictable natural occurrence

  2. Human risk- Potential actions of individuals, groups, or organizations

  3. Economic risk- uncertainty associated with stock market forces, economic trends, and politics

Result of the risk:

  1. Pure risk- Presents the chance of a loss but no opportunity for gain

  2. Speculative Risk- Chance to gain as well as lose

Control of Risk

  1. Controllable Risk: Can be reduced or avoided by actions you take

  2. Uncontrollable Risk: things that are out of your control

 

Insurability of Risk

  1. Insurable Risk:Large number of people risk the same thing

  2. Uninsurable Risk: Not possible to predict the amount of damage

Ways to deal with Risks:

  1. Avoid Risk

  2. Transfer risk

  3. Assume Risk

  4. Insure risk

 

Risks affecting Marketing:

  1. Risk of damage

  2. Product Design

  3. Liability Risk

Product liability Insurance- Protects against claims from consumers claims from the use of the company's products

 

Professional Liability insurance- Protects against claims of negligent or harmful actions by business professionals

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