Casualty Actuarial Society (CAS) Practice Exam

The category that includes human risk sources like arson and theft is indeed human risk sources. This classification focuses on risks that arise from actions taken by individuals or groups, as opposed to natural events or environmental factors.

Human risk sources encompass a broad range of risks that can be intentional or unintentional, including criminal acts such as arson and theft, as well as other risks associated with human behavior, like fraud, negligence, or even operational errors within organizations.

In contrast, natural risk sources pertain to events caused by natural occurrences, such as earthquakes, floods, or hurricanes. Environmental risk sources relate to risks arising from environmental conditions, which can include pollution or ecosystem changes but are not driven by human action directly. Financial risk sources focus on economic factors that can lead to monetary loss, such as market volatility or credit risk, rather than risks from human activities.

Understanding the distinction among these categories helps in risk management and in implementing appropriate strategies to mitigate various types of risks. In this context, recognizing that arson and theft are both human-driven events underscores their classification as human risk sources.