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IrinaVladis [17]
4 years ago
9

Morris Company self-insures its workers compensation loss exposure. The risk manager of Morris Company is concerned about the po

ssible impact of a single catastrophic claim. She decided to set a retention limit of $500,000 per-claim, and to purchase insurance that will be begin to pay once Morris Company has paid $500,000 on a single claim. The insurance the risk manager purchased is called
A) captive insurance.
B) excess insurance.
C) primary insurance.
D) umbrella insurance.
Business
1 answer:
Lady_Fox [76]4 years ago
3 0

Answer:

B) excess insurance.

Explanation:

An excess insurance policy covers any risk of loss beyond the scope of a primary insurance coverage. When a company purchases excess insurance, they do not have to pay any money in case a claim or a loss exceeds their primary insurance policy. It's basically having a double insurance in case your loss is too large, the second insurance will take care of it.

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