Name: ______________________

Class: _______

Date: _______

Risk Management Organizer

Directions: Summarize the topics listed. Also, provide examples when possible.
Different types of risk
Economic and non-economic

Pure and speculative

Example:

Example:

Controllable and uncontrollable

Insurable and uninsurable

Example:

Example:

Ways to handle risks

Avoid

Example:
Transfer

Example:
Insure

Example:
Assume

Example:

6200/6600 Principles of Business and Finance

Summer 2010

Page 371

Risk Management Organizer Continued

Business Insurable Risks
Personnel

Health

Disability

Life insurance

Property

Business operations

Types of Uninsurable Risks

Example

6200/6600 Principles of Business and Finance

Summer 2010

Page 372

Name: ______________________

Class: _______

Date: _______

My Examples of Risk Activity

Directions: Provide examples for the different types of risk.
Types of Risk

Examples

Economic

Non-economic

Pure

Speculative

Controllable

Uncontrollable

Insurable

Uninsurable

6200/6600 Principles of Business and Finance

Summer 2010

Page 373

Name: ______________________

Class: _______

Date: _______

Handling Risks Issues Activity

Directions: Read the provided business scenario about Intex Electronics and select from
the provided options of how the company should handle its risks. Write your responses
in the spaces provided and state why your response is the most appropriate way.
Intex Electronics manufactures and ships thousands of different products daily to its
customers. This company has been open for approximately fifteen years and made
millions of dollars. The owner of this company believes (1) that it will continue to sell
products at a profit. One of the managers named Fred proposed that the company
expand its line of products within the next six months. The other three managers
commended Fred for his vision of the companys growth in his reports. Due to their
financial concerns of risks (2), they requested more time to analyze the reports. After
analyzing them, they proposed postponing the expansion for at least two years.
Another manager named Jessie negotiated with an outside company to train all
employees on how to use the new software. Jessie wants to ensure (3) that all the
employees are trained properly and by experts. Jessie also negotiated a contract with
another company that will provide liability coverage (4) for Intex Electronics. She made
this decision based on the six accidents that happened on site last year.
Options: avoid, transfer, insure, or assume

1. ___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
2. ___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
3. ___________________________________________________________________
___________________________________________________________________
___________________________________________________________________
4. ___________________________________________________________________
___________________________________________________________________
___________________________________________________________________

6200/6600 Principles of Business and Finance

Summer 2010

Page 374

Name: ______________________

Class: _______

Date: _______

Health Insurance Organizer

Directions: Summarize the topics listed.
Types of Health Insurance
Hospital

Surgical

Regular medical

Major medical

Comprehensive
medical
Dental

Vision care

Health Insurance Providers (as it relates to employers that provides insurance)

Group health

Managed care

HMO

plans
PPO

State government
assistance

6200/6600 Principles of Business and Finance

Summer 2010

Page 375

Name________________________________ Class__________ Date___________

The Comparison of Life Insurance Policies Activity
Directions: Use the provided Life Insurance Chart in order to assist the Beddingfield
Company with selecting a group life insurance plan. Keep in mind that decisions about
life insurance options are usually made based on the number of dependents, age of
policy holder, and projected financial needs of spouse and dependents.
Life Insurance Chart

Term
Insurance
Premium
Payment Period

Cash Value

Begins low
but increases
gradually
Specified
number of
years (5, 10,
15)

None

Whole Life
Ordinary Life Limited Life

Permanent
Insurance
Variable Life

High but
usually stays
constant

Higher than
ordinary but
constant

Fixed and
regular

Varies at the
discretion of the
policyholder

Life of the
insured

Specified
number of
years (20-30)

Specified
Period

Specified Period

Some cash
value

More cash
value than
Ordinary Life,
but less than
variable

Death Benefit

Fixed

Fixed

Fixed

Purposes

Protection for
a specified
period of time

Protection for
life; some
cash value for
policyholder

Protection for
life; some
cash value for
policyholder

6200/6600 Principles of Business and Finance

Varied with
the rise or fall
in value of
investment
account
Always
exceeds cash
value
Life insurance
plus an
opportunity to
select
different cash
investments
option

Summer 2010

Universal Life

Varies with the

interest rate paid on
the cash value
Can vary at
discretion of
policyholder
Life insurance with
a fairly high rate of
return on cash
value

Page 376

The Comparison of Life Insurance Policies Activity Continued

The Beddingfield Company
The Beddingfield Company is deciding on what type of group insurance plan to offer
their employees. The company has over 300 employees. In a recent demographics
report the provided information was compiled about the employees.
Over 20% plan to retire within the next the next five to ten years
Over 30% have at least one child that will enter college within in the next five years
Over 50% have children under the age of 18
Over 35% are over the age of 40
Over 15% are over the age of 50
Over 10% are over the age of 60
Over 5% take care of an elderly parent
Describe why you would or would not recommend each policy the Beddingfield
Company should include in its group life insurance package?
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________
______________________________________________________________________

6200/6600 Principles of Business and Finance

Summer 2010

Page 377

Name: ______________________

Class: _______

Date: _______

Health Care Benefits Activity

Directions: You will compare health care coverage offered by three different companies.
To obtain information try to interview at least one human resources manager of a
company, research the Internet for a company and interview an adult that receives
health coverage from an employer.
Include the provided items in your table:
Types of health care coverage provided
Types of managed care plan- HMO or PPO
Types of other insurances such as disability and long-term care
Summary of other information about coverages such as cost, name of insurance
companies, and types of plans available

6200/6600 Principles of Business and Finance

Summer 2010

Page 378

Name________________________________ Class__________ Date___________

Health Care Benefits Scoring Guide
Directions: Use the checklist to check for specified content.
Checklist
Source 1 includes the listed items. This is the core of what must be achieved.
Types of health care coverage provided
Types of managed care plan-HMO or PPO
Types of life insurance plans
Types of other insurances such as disability and long-term care
Statement indicating finance charges will be reduced if contract is paid in full
before ending date.
Summary of other information such as cost, name of insurance companies,
and types of plans available
Comments:

Checklist
Source 2 includes the listed items. This is the core of what must be achieved.
Types of health care coverage provided
Types of managed care plan-HMO or PPO
Types of life insurance plans
Types of other insurances such as disability and long-term care
Statement indicating finance charges will be reduced if contract is paid in full
before ending date.
Summary of other information such as cost, name of insurance companies,
and types of plans available
Comments:

6200/6600 Principles of Business and Finance

Summer 2010

Page 379

Health Care Benefits Scoring Guide Continued

Checklist
Source 3 includes the listed items. This is the core of what must be achieved.
Types of health care coverage provided
Types of managed care plan-HMO or PPO
Types of other insurances such as disability and long-term care
Types of life insurance plans
Statement indicating finance charges will be reduced if contract is paid in full
before ending date.
Summary of other information such as cost, name of insurance companies,
and types of plans available
Comments:

6200/6600 Principles of Business and Finance

Summer 2010

Page 380