Risk Management MCQ Multiple Choice Questions Answers - Page 2 for Practice
31. Insurance Ombudsman is a Quasi judicial body established for speedy settlement of dispute in ............... ,............... and ............... manner
Correct Answer is: fair, impartial , judicial
32. Extended coverage endorsements normally do not cover damage caused by
Correct Answer is: nuclear radiation
33. A type of insurance that has been around since the ancient Greeks and Romans is ...................insurance.
Correct Answer is: marine
34. Which of the following is not the type of insurance:
Correct Answer is: Public Insurance, Social Insurance, Motor insurance, Marine insurance
35. Indemnity also means ...............according to the Collins Thesaurus
Correct Answer is: Guarantee, security, compensation, protection
36. Which type of insurance protects the policyholder against loss or damage to a ship or its cargo on the high seas?
Correct Answer is: marine
37. ...............is a corollary of the indemnity principle. It is ...............concept that legally differentiates insurance from gambling
Correct Answer is: subrogation, indemnity
38. according to ...............principle , life insurance can be affected on the lives of third parties provided the proposer has insurable interest in the third party
Correct Answer is: insurable interest in others life
39. The doctrine of subrogation is the supplementary principle of ...............
Correct Answer is: Bailment
40. Which statement is not true about a mutual insurance company?
Correct Answer is: It has stockholders and operates to earn a profit
41. ...............insurance is the one where the loss is not due to physical damage but the result of dishonesty of employees as a result of physical damage
Correct Answer is: Pecuniary
42. Which one of the following is not a condition for an insurable loss?
Correct Answer is: Losses must result from an intentional action by the insured person
43. The ...............principle states that the business and individual should insure potentially serious losses before relatively minor losses
Correct Answer is: large loss
44. Life insurance and general insurance are divided on the basis of
Correct Answer is: business point of view
45. A state law requires individuals suffering injury or loss from an automobile accident to be reimbursed by their own insurance companies. What type of insurance is this?
Correct Answer is: No-fault auto insurance
46. Which of following statement is correct 1) According to captive model an insurance company market its products almost exclusively through the distribution channels of its banking parent. 2) According to partnership model, the insurance company distributes its products partly, though not exclusively through a banking channel.
Correct Answer is: both 1 & 2
47. Which of the following is the advantage of reinsurance for insurer? 1. Insurer can share his risk with other insurance. 2. It reduces the situation of certainty by distribution of risks among other insurers
Correct Answer is: only 1
48. 1. Risk can be eliminated without an adverse effects on the goals of an individual or business probably should not be avoided. 2. self insurance is another way of mixing risk retention & risk transfer. Which of the above statement is false.
Correct Answer is: only 1
49. Costs for injury or death due to hazards at the work place are covered under ..................insurance
Correct Answer is: public liability
50. The ratemaking function in a life insurance company is performed by ...............
Correct Answer is: actuarial department
51. Which type of coverage pays for damages intentionally caused by another person, such as breaking a windshield in a parking lot?
Correct Answer is: Comprehensive coverage
52. defective products is an example of which loss exposure
Correct Answer is: liability loss exposure
53. The law of large numbers can be applied more easily to ...............than speculative risk
Correct Answer is: Pure Risk
54. A lien can be placed on ones income and financial assets to satisfy a legal judgment. This results in ...............
Correct Answer is: liability risk
55. In ...............or ............... method a fixed share or quota of the risk is reinsured
Correct Answer is: Quota or fixed share treaty
56. ...............happen when an insurance company has undertaken more risk burden on its shoulders than its bearing capacity. ................... is a device to reduce the risk
Correct Answer is: reinsurance, double insurance
57. ...............refers to the cause of loss or the contingency that may cause a loss
Correct Answer is: Peril
58. When a jewelry store locks its merchandise in a vault at the end of the day, it is practicing
Correct Answer is: risk avoidance
59. Which risk-management technique does self-insurance satisfy?
