Question 1

Duty to minimize loss is incorporated in the policies through _________
A)warranties.
B)Conditions.
C)clauses.
D)declaratives

Accepted Answer

Conditions in insurance policies often include the duty to minimize loss, requiring the insured to take reasonable steps to prevent further damage or loss.

Question 2

_______ means those risks which involve a situation where there is a possibility of gain.
A)Personal risk.
B)Speculative risk.
C)Other risk.
D)Liability risk.

Accepted Answer

Speculative risks are those types of risks that offer the possibility of either a gain or a loss. This contrasts with pure risks, which only involve the possibility of loss or no change. Examples of speculative risks include investments in the stock market, real estate ventures, and entrepreneurial activities.

Question 3

A policy protecting a group of persons, usually employees of a firm generally called as ___________
A)Fire insurance policy.
B)Group insurance policy.
C)Marine insurance.
D)Automobile insurance.

Accepted Answer

Group insurance policy is designed to cover a group of people, typically employees of a company, offering them insurance coverage under a single policy.

Question 4

When was IRD Act passed?
A)1972.
B)1999.
C)1989.
D)2000.

Accepted Answer

The IRD Act, referring to the Insurance Regulatory and Development Authority Act, was passed in 1999.

Question 5

Which of the following is the similarity between insurance and gambling?
A)The amount of loss to be paid is known before hand.
B)Promise to pay on the happening of an event.
C)Both the parties win on happening of an event.
D)Both are enforceable at law.

Accepted Answer

The answer of Which of the following is the similarity...

Question 6

A human life is an income-generating asset______________
A)true.
B)false.
C)partially true.
D)partially false.

Accepted Answer

From an economic perspective, a human life can be considered an income-generating asset because individuals can generate income through employment or other forms of economic activity over their lifetime.

Question 7

The premium actually paid by the policy holder depends upon___________
A)the wealth of the person to be insured.
B)the level of risk assessed by the insurer.
C)the tables of rates printed by the insurer.
D)agents report.

Accepted Answer

The premium is determined by the level of risk assessed by the insurer, which considers factors like age, health, and lifestyle of the insured.

Question 8

Notification of Alteration in Risk is a condition _____________.
A)precedent to liability.
B)subsequent to liability.
C)precedent to the contract.
D)subsequent to the contract.

Accepted Answer

The answer of Notification of Alteration in Risk is a...

Question 9

As the age increases risk on the life _______.
A)Increases.
B)Decreases.
C)does not change.
D)Moderate.

Accepted Answer

As age increases, the risk on life increases due to factors such as deteriorating health, increased likelihood of chronic diseases, and a higher probability of mortality.

Question 10

If the interest rates in the market are higher, then cost of insurance _________.
A)Increases.
B)moderate.
C)Decreases.
D)no change.

Accepted Answer

Higher interest rates can lead to a decrease in the cost of insurance because insurers can earn more on their investments, allowing them to charge lower premiums.

Question 11

One who shares the risk under an insurance policy or policies is known as __________.
A)Assurer.
B)Insurer.
C)Co-insurer.
D)Agent.

Accepted Answer

A co-insurer shares the risk under an insurance policy with another insurer, distributing the risk among multiple parties.

Question 12

The concept of bancassurance originated in ___________.
A)France.
B)U.S.A.
C)Engla

Accepted Answer

The concept of bancassurance, which is the partnership between a bank and an insurance company whereby the insurance company uses the bank's sales channels in order to sell insurance products, originated in France.

Question 13

Individuals define risk as____________.
A)deviation from some expected return.
B)a cost of investing.
C)a quantitative measure.
D)"losing money."

Accepted Answer

The answer of Individuals define risk as____________.
A)deviation from some expected...

Quiz 2: Insurance Policy and Risk Management: Part B

Duty to minimize loss is incorporated in the policies through _________

_______ means those risks which involve a situation where there is a possibility of gain.

A policy protecting a group of persons, usually employees of a firm generally called as ___________

When was IRD Act passed?

Which of the following is the similarity between insurance and gambling?

A human life is an income-generating asset______________

The premium actually paid by the policy holder depends upon___________

Notification of Alteration in Risk is a condition _____________.

As the age increases risk on the life _______.

If the interest rates in the market are higher, then cost of insurance _________.

One who shares the risk under an insurance policy or policies is known as __________.

The concept of bancassurance originated in ___________.

Individuals define risk as____________.