Final answer:
The subject of this question is Business. An organization's cost of risk associated with an asset or activity includes various components, such as losses not reimbursed by insurance, insurance premiums, costs of risk control techniques, and administrative costs.
Step-by-step explanation:
The subject of this question is Business. The question is asking about an organization's cost of risk associated with an asset or activity. The cost of risk includes the costs of accidental losses not reimbursed by insurance or other outside sources, insurance premiums or expenses incurred for non-insurance indemnity, costs of risk control techniques to prevent or reduce the size of accidental losses, and costs of administering risk management activity.
For insurance companies, the major additional costs, other than the payment of claims, are the administrative costs of running a business, such as hiring workers, administering accounts, and processing insurance claims. Insurance premiums and claims payments are usually much larger than the amounts earned through investments or administrative costs.
In summary, the cost of risk associated with an asset or activity includes various components, including losses not reimbursed by insurance, insurance premiums, costs of risk control techniques, and administrative costs. These costs are important considerations for organizations and insurance companies.