Liquidity risk

{
  "id": "MLC-T-INS-002034",
  "term": "Liquidity risk",
  "field": "Insurance and risk management",
  "definition": "The potential for an insurer to be unable to meet its financial obligations as they fall due, either because it cannot convert assets into cash quickly enough or because it faces unexpected cash outflows. This risk can arise from sudden increases in claims, investment market disruptions, or difficulty selling illiquid assets. Effective risk management involves maintaining a diversified portfolio of liquid investments.",
  "url": "https://mlchart.com/terminology/insurance/liquidity-risk/"
}