Which of the following statements BEST summarizes the function of insurance?

Insurance

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Which of the following statements BEST summarizes the function of insurance?

A) It is a form of legalized gambling.

B) It protects against living too long.

C) It spreads financial risk over a diverse group of people who are exposed to different risks.

D) It spreads financial risk over a large group so as to minimize the loss to any one individual.

Answer: D

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