Risk tolerance

{
  "id": "MLC-T-INS-002991",
  "term": "Risk tolerance",
  "field": "Insurance and risk management",
  "definition": "The degree of variability in investment or underwriting results an organization is willing to withstand in pursuit of its objectives. It is a specific, measurable metric that quantifies the boundaries of acceptable risk-taking, often expressed in terms of potential financial loss, earnings volatility, or capital adequacy ratios. An insurer's risk tolerance statement might specify the maximum acceptable loss from a single catastrophic event as a percentage of its surplus.",
  "url": "https://mlchart.com/terminology/insurance/risk-tolerance/"
}