What type of risk is involved when there is no possibility of gain?

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Multiple Choice

What type of risk is involved when there is no possibility of gain?

Pure risk is the type of risk that involves only the chance of loss or no loss, with no possibility of gain. In insurance, these are the risks that can be indemnified because there isn’t any potential for profit driving them. Examples include property damage, illness, or death. By contrast, speculative or investment risks involve both loss and gain possibilities, so they aren’t classified as pure risks. Since there’s no possibility of gain, this situation fits pure risk.

Pure risk is the type of risk that involves only the chance of loss or no loss, with no possibility of gain. In insurance, these are the risks that can be indemnified because there isn’t any potential for profit driving them. Examples include property damage, illness, or death. By contrast, speculative or investment risks involve both loss and gain possibilities, so they aren’t classified as pure risks. Since there’s no possibility of gain, this situation fits pure risk.

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