Question 27 Discussion/Calculation Question [13 points] Time left 2:05.46 Not yet answered Marked out of 13.00 For a risk to be ideally insurable, the insured losses must be entirely accidental, unforeseen, unexpected, a result of chance, unintentional, and outside the insured's Flag question control. During the COVID-19 pandemic, the organizers of two major tennis tournaments, the French Open and Wimbledon, made different decisions. The 2020 French Open, originally scheduled for 24 May to 7 June, was postponed to 27 September to 11 October due to the pandemic. In contrast, the 2020 Wimbledon Championships, which were to take place from 29 June to 12 July, were cancelled entirely because of the pandemic. Interestingly, the 2020 French Open was uninsured, while Wimbledon had an insurance policy in place covering infectious diseases, amounting to f100 million. a) Apparently, the difference in insurance coverage led to different behaviour by the organizers regarding the cancellation of the tournament. What is the technical term for the associated hazard? [2 points] b) The insurance company "Tennis Tournament Insurance" is internally discussing rom leading to a cancellation of theEn a) Apparently, the difference in insurance coverage led to different behaviour by the organizers regarding the cancellation of the tournament. What is the technical term for the associated hazard? [2 points] Fini b) The insurance company "Tennis Tournament Insurance" is internally discussing how to prevent the presence of insurance from leading to a cancellation of the tournament in the future, if a postponement is also conceivable. Name and discuss one option that insurers can establish in their contracts to limit changes in the behaviour of the insured after the insurance has been taken out. [3 points] c) For diversification reasons, Tennis Tournament Insurance also offers home and contents insurance for tennis clubs. An employee of "Tennis Tournament Insurance" makes the following proposal: "Look at those home and contents insurance policies. These policies make the policyholder pay a deductible - the policyholder pays the first $5000 of any loss. That is an unattractive feature of these policies because some tennis clubs cannot afford the deductible. Let us change the rules to say that the deductible should be just $500." What would be your comments on this proposal? In your discussion, address the impact of this proposal on behavioural change of the policyholder, administrative and claims costs for the insurance company, and the level of the insurance premium. [8 points]