Insurance Cover

Please answer these questions in your own words. Please do not copy word for word from any sites thank you very much.

1- Can insurance assist a business with the risks of direct foreign investments? If so, please share how insurance can be an effective protective strategy for a company involved in direct foreign investments?

2- As we all know insurance is a financial component of a business and of our life. We have the option to purchase insurance to retain money for our losses (i.e. claims). Insurance is a ‘catch 22’, one can purchase insurance and never file a claim. This appears as though we have made an unsuccessful decision with our money. However, if our building burns down, we are able to receive compensation for our loss.

3- Effective risk management will limit unnecessary costs such as waste, labor, and other costly assets. Managers need to identify and monitor possible threats (including human capital) before they harm a business. This is where insurance is imperative to have within a business. Class, do you agree or disagree? Please explain.

……………….Answer Preview……………..

A business can adopt insurance cover to cover different selected risks associated with foreign direct investments. A company dealing with foreign direct investments faces the risk of losing their equity due to confiscation. Despite this, insurance cover can be adopted in this type of investment and can be covered on specific risks such as confiscation and the inability of the investor to transfer dividends overseas during the periods of hard currency. Insurance……………….

APA

298 Words