Which exposures may be caused by pure risks?

Which exposures may be caused by pure risks?

• A. Personal
• B. Liability
• C. Property
• D. All of the above

Answer: (D)

Exposures are potential losses that an insured may face because of a risk. A pure risk is one with only two possible outcomes: loss or no loss, never a gain. In aviation, that kind of risk can create different kinds of exposures at once. Property exposure covers damage to physical assets like the aircraft, hangar, or equipment. Liability exposure involves claims from injuries or property damage to others, including passengers or third parties. Personal exposure concerns the risk to individuals themselves, such as injury, illness, or death and the resulting loss of income. Since a single pure risk event can trigger multiple types of losses, all three exposure areas can be affected. That’s why the best answer is all of the above. If we looked at just one category, we’d miss the other potential losses that could occur under the same risk.

Exposures are potential losses that an insured may face because of a risk. A pure risk is one with only two possible outcomes: loss or no loss, never a gain. In aviation, that kind of risk can create different kinds of exposures at once. Property exposure covers damage to physical assets like the aircraft, hangar, or equipment. Liability exposure involves claims from injuries or property damage to others, including passengers or third parties. Personal exposure concerns the risk to individuals themselves, such as injury, illness, or death and the resulting loss of income. Since a single pure risk event can trigger multiple types of losses, all three exposure areas can be affected. That’s why the best answer is all of the above. If we looked at just one category, we’d miss the other potential losses that could occur under the same risk.