11
QuizMultiple Choice

Money and Credit Management — Test

Question 11 • CMS 2026-2027 Economics and Personal Finance INITIAL CREDIT

Insurance is a financial service that allows a

Answer
A
company to control finances for a consumer.
B
company to maximize risk for a consumer.
C
consumer to share liability with a company.
D
consumer to transfer all risk to a company.

Explanation

Insurance lets a consumer pay a premium so an insurance company takes on the financial risk of certain covered losses. It does not transfer every possible risk, but among these choices, “consumer to transfer all risk to a company” best describes the basic purpose of insurance.

AI-written and checked against the verified answer.

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