The purpose of determining the type of risk

1. Pure Risk: Pure risk is a risk that has only a chance of loss and no possibility of profit. For example, homeowners are exposed to fire risk, automobile owners are exposed to collision risk, etc. When fire and collision accidents occur, they suffer a loss in financial benefits.

2. Speculative risk: speculative risk is relative to pure risk, refers to both the opportunity for loss and the possibility of profit. The consequences of speculative risk are generally three: one is no loss; two is a loss; three is a profit. For example, when buying and selling stocks on the stock market, there are three consequences: making money, losing money, and no loss or profit, and thus it is a speculative risk.

According to the subject

1. Property risk: property risk refers to the risk of causing damage, loss or depreciation of all tangible property and the risk of economic or monetary loss. Such as plant, machinery and equipment, finished products, furniture, etc. will be subject to the risk of fire, earthquake, explosion, etc.; ships in navigation, may be subject to the risk of sinking, collision, grounding, etc..

Property loss usually includes both direct and indirect loss of property.

2. Personal risk: personal risk refers to the risk of disability, death, loss of labor capacity and increased medical expenses. Such as people will be born, old age, disease, death and other physiological laws and natural, political, military and other reasons and early death, disability, loss of working ability or old age without dependence.

There are generally two types of losses due to personal risk: one is the loss of earning capacity; the other is the loss of additional costs.

3. Liability risk: liability risk refers to the risk of civil liability in accordance with the law, contract or morality due to the negligence or negligent behavior of an individual or a group, resulting in other people's property damage or personal injury or death.

4. Credit risk: credit risk refers to the economic transactions, the right and the obligee, due to one party's default or violation of the law, resulting in the other party to suffer the risk of economic loss. For example, in the import and export trade, the exporter (or importer) will suffer economic losses due to the non-performance of the importer (or exporter).

In accordance with the behavior

1. Specific risk: the risk of a causal relationship with a specific person, that is, caused by a specific person, and the loss only involves the risk of a specific individual. Such as fire, explosion, theft, and legal liability for property damage or personal injury to others belong to this category.

2. Basic risk: the risk of damage to society. The cause and effect of the basic risk is not related to a particular person, at least the risk of the individual can not be prevented. Risks related to social or political, and risks related to natural disasters are basic risks. For example, earthquakes, floods, tsunamis, and economic downturns fall into this category.