What is essential for a risk to be insurable according to the criteria provided?

For a risk to be insurable, it is essential that the risk is outside of the insured's control. This means that the event causing the risk must occur due to factors that are not manageable or influenced by the insured party. Insurers look for risks that can be objectively evaluated and for which the cause can be determined without the insured's interference.

When risks are outside the insured's control, they align with the principles of insurability, where the insurer can predict the frequency and severity of losses based on statistical data. This allows insurers to establish premiums and reserves based on the likelihood of a covered event occurring. Moreover, if a risk were entirely predictable or manageable by the insured, there would be little need for insurance, as individuals would be able to avoid the risk altogether or mitigate it significantly.

The concept of insurability relies on risks that can be pooled among many insureds, allowing for an equitable distribution of losses across a larger group. Hence, having multiple parties or making a risk ambiguous are not essential criteria; rather, the focus is on the uncontrollable nature of the risk itself.