[OBJECTIVE]
Subject: Insurance and Risk Management
Time Allowed: 15 Min
Total Marks: 10
NOTE: ATTEMPT THIS PAPER ON THIS QUESTION SHEET ONLY. Division of marks is given in front of each question. This Paper will be collected back after expiry of time limit mentioned above.
Part-I Encircle the correct option, each question carries equal marks. (10)
1. A physical condition that increases the chance of loss is known as :
A. Moral hazard
B. Physical hazard
C. Legal hazard
D. Morale hazard
2. A risk that affects the entire economy is called:
A. Pure risk
B. Speculative risk
C. Enterprise risk
D. Fundamental risk
3. Which one of the following is not the method of handling risk?
A. Insurance
B. Non insurance transfer
C. Active retention we
D. Direct transfer
4. When an individual is restored to his/her financial position prior to the occurrence of loss this state is known as
A. Rehabilitation
B. Indemnification
C. Identification of loss OK
D. Risk transfer
5. ______________ is the arrangement by which the primary insurer that initially writes the insurance transfers to another insurer.
A. Reinsurance
B. Segregating
C. Co-insurance
D. All of the above
6. Risk Pooling is an example of.
A. a Catastrophic Loss Event
B. diversifying risk
C. a speculate risk
D. applying the risk-return trade-off :
7. Ratemaking refers to the pricing of insurance. Insurance rates are determined by
A. Insured
B. coinsurer
C. reinsurer
D. actuaries
8. Sales and marketing in insurance referred to as a ___________.
A. Ratemaking
B. underwriting
C. production
D. reinsurance
9. All of the following are claim adjustors except
A. Agent
B. company adjustor
C. dependent adjustor
D public adjustor
10. The principle of indemnity states that insurer should not pay
A. Actual loss
B. more than actual loss
C. less than actual loss
D. none of above
