Deck 1: Insurance Policy and Risk Management: Part A

Question 1

….. is a condition in which there is a possibility of an adverse deviation from a desired outcome that is expected or hope for.

A)Loss
B)Profit
C)Risk
D)Uncertainty

Answer 1

Risk

Question 2

Relative variation of actual loss from expected loss is called………

A)Subjective risk
B)Objective risk
C)Actual loss
D)Expected loss

Answer 2

Objective risk

Question 3

Risk is measurable……..

A)Loss
B)Profit
C)Uncertainty
D)None of the above

Answer 3

Uncertainty

Question 4

…………. Refers to a situation where outcome is not certain

A)Uncertainty
B)Loss
C)Insurance
D)None of the above

Question 5

If any risk is concerned with financial loss, it is termed as………..

A)Business risk
B)Business loss
C)Financial risk
D)Insurable claim

Question 6

………… another name of fundamental risk

A)Systematic risk
B)Interest rate risk
C)Group risk
D)Loss

Question 7

Pure risk situation are those where there is a possibility of………….

A)Loss or no loss
B)Loss
C)Variation
D)None of the above

Question 8

Speculative risk is a situation in which…………………… is possible

A)Loss
B)Profit
C)Either a profit or loss
D)None of the above

Question 9

Changes is technology is a example for …………

A)Pure risk
B)Speculative risk
C)Static risk
D)Dynamic risk

Question 10

In static risk.............

A)Losses cannot be predicted
B)Losses can be predicted
C)Losses are not easily predictable
D)None of these

Question 11

Risk which can be measured using numerical scale are known as

A)Quantifiable risk
B)Static risk
C)Dynamic risk
D)Speculative risk

Question 12

………………is an example for personal risk

A)Business loss
B)Fire occurred in business premises
C)Risk of premature death
D)None of the above

Question 13

Property damaged because of earthquake is…………risk

A)Risk for general insurance
B)Non insurable risk
C)Property risk
D)None of the above

Question 14

Spreading of risk otherwise termed as……….

A)Shifting of risk
B)Acceptance of risk
C)Reduction of risk
D)Spreading of risk

Question 15

Insurance is a risk management technique involving…

A)Risk retention
B)Risk avoidance
C)Loss Control
D)Risk transfer

Question 16

An escape from disability or death in a plain crash by refusing to fly is called…

A)Risk shifting
B)Risk avoidance
C)Risk hedging
D)None of these

Question 17

………… is the process of reducing frequencies and severely of losses.

A)Loss prevention
B)Loss Control
C)Avoidance of risk
D)None of the above

Question 18

Willingness to retain whole or part of a given risk is called…………..

A)Risk retention
B)Risk carrying
C)Risk bearing
D)None of the above

Question 19

Annual maintenance contract for computers is …………

A)Risk avoidance
B)Loss reduction
C)Insurance
D)Transfer of risk by contract

Question 20

Which of the following is a method of risk identification.

A)Insurance
B)Standard deviation method
C)Checklist method
D)None of these

Question 21

Risk evaluation breaks down into two parts. They are:

A)Probability of loss occurring and its severity
B)Risk calculation and risk analysis
C)Loss calculation and avoidance
D)None of the above

Question 22

…………….. is planned retention by which the part or full of the exposure arising a risk factor is retained by the firm

A)Reinsurance
B)Self insurance
C)Risk financing
D)None of the above

Question 23

IRDA Act passed in the year…………..

A)1972
B)1999
C)1989
D)2000

Question 24

A policy for protecting a group of employees in a firm is called………..

A)General Insurance
B)State life insurance
C)Group insurance
D)None of the above