Page 8 - Insurance Surveyors Book Ebook IC S01

Survey And Loss Assessment IC-S01

Speculative Risks are risks where the prospect is either gain or loss.

It can be seen that in most cases it is unlikely that anything other than loss will

result.

Entrepreneurial or business risk undertaken by businessmen is an example of

speculative risk where either profit or loss may result. The following chart

provides illustrations of business risks.

Technical : New Technology

Social : Consumer Behaviour, Industrial Unrest

Economic : Inflation, Tax Policy, Competition

Political : War, Nationalisation

B. Dynamic and Static Risks

These are more properly identified with the factors causing change. Dynamic risks

are those associated with changes in society and arise from market, management

and/or political forces and can result in either profit or loss. Static risks are

independent of these movements and result only in loss.

C. Fundamental and Particular Risks

Fundamental risks are those which affect if not the whole of society at least a

large proportion of it and arise from natural disasters or changes in the political

or economic system.

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