Marketing Essentials Chapter 34
Risk avoidance
A business refuses to engage in particularly hazardous activity
Insurance policy
A contract between a business and an insurance company to cover a specific risk
Risk retention
Companies retain or assume financial responsibility for the sequence of loss
Worker's compensation insurance
Covers employees who suffer job-related injuries and illness and protects employers from lawsuits filed by am employee injured on the job
shoplifting
External theft that involves stealing merchandise from a business
Sole proprietor
Individual business owner who is usually required to have life insurance in order to borrow money
Fidelity bonds
Protect a business from employee dishonesty
Business liability insurance
Protects a business against damages for which it may be held legally liable, such as an injury to a customer or damage to a property of others
Credit insurance
Protects a business from losses on credit extended to customers
Product liability insurance
Protects against business losses resulting from personal injury or property damage caused by products manufactured or sold by a business
Performance bonds
Provide financial protection for losses that might occur whem a construction project is not finished due to the contractor's impaired financial condition
Extended coverage
Provides protection against types of loss that may not be covered under a basic property insurance policy
Life insurance
Purchased to protect the owners or managers of a business
Replacements cost coverage
Reimburses the business owner for the replacement costs of buildings and other personal property
Human risks
Risks caused by human mistakes, dishonesty, or other risks that can be controlled by humans
Natural risks
Risks that are caused by natural occurrences
Economic risks
Risks that result from changes on overall business conditions
Business risk
Situations that can lead to financial gain, loss, or failure
Risk management
Systematic process of managing an organization's risks to achieve objectives in a manner consistent with public interest, human safety, environmental needs, and the law
Liability
The state of being repsonsible for something
Computer worms
Viruses that can be downloaded inadvertently by employees and can wreak havoc on internal computer networks and communication systems
POS
computer reports that mentor void transfers, cash discrepancies, sales reports, refund by employees, employees' discounts, and cash register transactions