10. Risks are classified in various ways. One classification is based on the extent of the damage likely to be caused.Critical or Catastrophic risks are those which may lead to the bankruptcy of the owner. It would happen it the losss is total like in a tsunami, wiping out everything. It can also happen if the deceased person was heavily in debt. Important risk may not spell doom. But may upset family or business finances badly, requiring a lot of time to recover. The adverse effects of an economic recession is one such. Less damaging are unimportant risks, like remporary illness or accidents.
11. Another classification is beteen Finanacial and non financial risks, referred to in an earlier paragraph. Insurance is concerned with only finanacial risks.
12. A third classification is between dynamic and static risks. Dynamic risks are caused by perils whick have national consequence, like inflation calamities technology, political upheavals, etc. Static risks are caused by perils which have no consequence on the national exonomy like a fire or theft or misappropriation.
13.
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