- 07/03/2019 at 7:59 am #1307300EduGorillaKeymasterSelect Question Language :
Direction: In the following passage, there are blanks each of which has been numbered. These numbers correspond to the question numbers; against each question, five words have been suggested, one of which fills the blanks appropriately.
Insurance is a means of protection from (16) loss. It is a form of risk management primarily used to hedge against the risk of a contingent, uncertain loss.
An entity which provides insurance is known as an insurer, insurance company, or insurance carrier. A person or entity who buys insurance is known as an insured or policyholder. The insurance (17) involves the insured assuming a guaranteed and known relatively small loss in the form of payment to the insurer in exchange for the insurer’s promise to (18) the insured in the event of a covered loss. The loss may or may not be financial, but it must be reducible to financial terms, and must involve something in which the insured has an insurable interest (19) by ownership, possession, or preexisting relationship.
The insured receives a contract, called the insurance policy, which details the (20) and circumstances under which the insured will be financially compensated. The amount of money charged by the insurer to the insured for the (21) set forth in the insurance policy is called the premium. If the insured (22) a loss which is potentially covered by the insurance policy, the insured submits a claim to the insurer for processing by a claims adjuster.
Methods for (23) or distributing risk were practiced by Chinese and Babylonian traders as long ago as the 3rd and 2nd millennia BC, respectively. Chinese merchants (24) treacherous river rapids would redistribute their wares across many vessels to limit the loss due to any single vessel’s capsizing. The Babylonians developed a system which was recorded in the famous Code of Hammurabi, c. 1750 BC, and practiced by early Mediterranean sailing merchants. If a merchant received a loan to fund his shipment, he would pay the lender an additional sum in (25) for the lender’s guarantee to cancel the loan should the shipment be stolen, or lost at sea.
Find out the appropriate word in each case
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