The Risk Balls Game: Transforming Risk and Insurance Into Tangible Concepts

The Risk Balls game is used as a game in an introductory insurance course to demonstrate in a tangible way the notion of risk and its relationship to insurance. Through playing with the ``risk balls,'' each one representing a different type of risk, the students experience feelings of anxiety about risk, and later, the sense of anxiety reduction when they transfer the risk balls to insurers. The game incorporates complex concepts of risk transfer and risk reduction via pooling and sharing of risk. The mathematical implications of the law of large numbers are physically felt in the classroom when the students experience the relief associated with transferring the risk balls to insurers. The discussion that ensues during the game includes aspects of the underwriting process; moral hazard; adverse selection; the role of agents, insurers, and regulators; and the nature of the insurance contract. The game of risk balls stimulates lively group discussions and provides hands‐on experience with risks such as premature death risk or fire risk and the fears associated with them.