Which of the following statements is true regarding pure and speculative risks?

The statement that pure risks are insurable while speculative risks are not captures a fundamental principle of insurance. Pure risks involve situations that can only lead to a loss or no loss, such as the risk of a house burning down or a person getting injured. These risks can be effectively quantified and managed through insurance policies, which provide financial protection against the potential losses that could arise.

On the other hand, speculative risks include scenarios where there is a possibility of loss, gain, or no change at all, like investing in the stock market or starting a new business. Because of the unpredictable nature of speculative risks, they are generally not insurable through traditional insurance means. They fall outside the purview of standard insurance practices, which focus on providing coverage for risks that can reliably lead to losses.

This distinction underscores the nature of how insurance operates—focusing on pure risks which can be actuarially determined and adequately covered, while leaving speculative risks to other forms of risk management such as self-insurance or investment strategies.