Properly estimating loss severity is essential in treating a loss exposure because the potential severity is a major consideration in determining whether to

Properly estimating loss severity is essential in treating a loss exposure because the potential severity is a major consideration in determining whether to



A. Use risk control or risk financing.
B. Use loss avoidance or loss prevention.
C. Insure or retain a particular loss exposure.
D. Physically inspect or rely on a loss exposure survey.


Answer: C. Potential severity is a major consideration in determining whether to insure or retain a particular loss exposure.

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