Passive Retention
Definition of "Passive retention"
Practice in which no funds are set aside on a mathematical basis to pay for expected losses. This occurs when a risk manager is not aware of an exposure, when the cost of treating an exposure positively is prohibitive, or if the severity of a loss (should it occur) would be inconsequential.
Popular Insurance Terms
Combination of several coverages to protect the insured. For example, the comprehensive health insurance policy combines the basic hospital plan with major medical insurance to cover ...
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Unexpected claims occurring above the expected claims for which a contingency reserve is maintained. ...
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