T/F If the statement is False then tell why.

___4 Insureds in a pool pay their true expected loss rather than the average loss for the pool.

___5 We can more accurately predict average losses for the group than we can predict the loss that each individual will have.

___6 Pooling increases risk by increasing the probabilities of extreme outcomes.

___7 Diversification means that you dont put all your eggs in one basket and pay your own actual losses. Diversification through a pooling arrangement allows individuals to pay an average group loss amount with less chance of extreme outcomes.