Which of the following is NOT an element of insurable risks?

In the context of insurable risks, each element plays a vital role in determining whether a risk is insurable. A key aspect of insurable risks is a large number of homogeneous units, which helps in spreading the risk over a larger pool. This ensures that while individual losses may occur, they can be offset by the premiums collected from a larger group.

Uncertain loss is also a crucial element, as insurance is designed to protect against risks that are not predictable in terms of when they may occur or the amount of loss. This uncertainty makes the formation of insurance viable; if losses were fully predictable, the concept of insurance would not hold.

Considering these elements, high frequency of loss is not a desirable characteristic of an insurable risk. Typically, for effective risk management, insurers prefer risks that occur infrequently, as frequent losses can lead to unsustainable claims and disrupt the balance that insurance relies on. Therefore, a high frequency of loss fails to align with the foundational principles of underwriting and risk pooling.

The potential for economic hardship is also a significant factor, as it emphasizes the need for coverage. Insurance aims to provide financial protection against losses that could cause serious financial distress.

Thus, the aspect that does not conform to the typical elements of ins