A3: Insurance & risk management - created from Mind Map

Protect physical assets

Protect earnings & profit potential

Protect financial transactions

Premiums are pooled by the insurer to invest to grow value of reserves against inflation.Key person policies allow companies to insure against death or long-term illness of individuals vital to income stream of company.Risks too big to be covered by a single insurer are assessed & accepted but then passed to a reinsurance company for a proportion of the premium.  Lloyd's of London offer a specialist insurance & reinsurance market through its underwritiing syndicates.Derivatives are used to offset losses when protecting financial transactions.

Insurance & risk management

Notes