This video discussing how Insurance provides significant risk management to consumers. Insurance is an essential tool for protecting ones family when the major bread winner passes.
The video also discusses risk management. Risk is tailored to individual circumstances and reflects many years of history of insurance industry experience, include real risks, moral moral hazard and selection bias issues.
Enjoy the video. I have found insurance is good when you need it.
Portfolio diversification is the most fundamental concept of risk management. The allocation of financial resources in stocks, bonds, riskless, assets, oil and other assets determine the expected return and risk of a portfolio. Taking account of covariances and expected returns, investors can create a diversified portfolio that maximizes expected return for a given level of risk. An important mission of financial institutions is to provide portfolio-diversification services.
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