Mr. Green Tea utilizes its own delivery trucks to deliver it…
Mr. Green Tea utilizes its own delivery trucks to deliver its ice cream to customers. Mr. Green Tea owns five delivery trucks, and has five employees that drive these trucks to deliver finished product to customers. To protect against the risks of operating these trucks = Mr. Green Tea has purchased a commercial auto insurance policy from Liberty Mutual Insurance. The insurance policy has a $1,000,000 policy limit = which insures both property damage to the trucks themselves; AND insures the legal liability that could result from a driver’s negligence causing property damage and/or bodily injury damages to a third party on the road The insurance policy has a $1,000 deductible Based on the above scenario, what are ALL the forms of risk treatment Mr. Green is engaging in with the above option? I. Risk Financing = more specifically, an insurance risk transfer to Liberty Mutual Insurance II. Risk Financing = more specifically, retention (in the form of the $1,000 deductible) III. Risk Modification = more specifically, risk prevention