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Insurance

Cost of risk

Risk management is the process of identifying, evaluating, and mitigating potential risks in a financial context. This includes the costs associated with risk reduction efforts, as well as the opportunity cost of foregoing certain activities due to risk considerations. Additionally, expenses related to financing potential losses must be taken into account, along with the cost of reimbursing any actual losses. Essentially, risk management involves a comprehensive approach to understanding and addressing financial risks.
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