Risk Pooling
/ˈrɪsk ˈpuːlɪŋ/
Definitions
- (n.) The practice of combining risks from multiple entities to reduce the overall uncertainty and potential financial impact, commonly used in insurance and financial law.
Insurance companies use risk pooling to spread liability among policyholders, minimizing individual exposure.
Forms
- risk pooling
Related terms
See also
Commentary
Risk pooling is central in drafting insurance agreements and financial risk regulations to balance exposure and coverage among participants.
This glossary is for general informational and educational purposes only. Definitions are jurisdiction-agnostic but reflect terminology and concepts primarily drawn from English and American legal traditions. Nothing herein constitutes legal advice or creates a lawyer-client relationship. Users should consult qualified counsel for advice on specific matters or jurisdictions.