RISK TEST GROUP 1

1. Which one is NOT the types of subject matter of insurance

•  Aviation

• Personal life

• Health

• Marine

2. What is the definition of insurable interest

• as the positive duty to disclose fully and accurately all material facts relating to the proposed risk that a proposer knows or is reasonably expected to know, whether asked or not.

• a fact which will influence a prudent underwriter in deciding the acceptance of the risk or the premium to be charged.

• a guarantee or assurance to put the insured in the same position in which he was immediately prior to make good the loss.

• as the right to insure arising out of legally recognized financial interest which a person has in the subject matter of insurance

3. Which one is false about indemnity

• Based on principle of indemnity, the insured shall be restored to the same financial position after the loss, as he had enjoyed immediately before the loss.

• The principle of indemnity has been developed to prevent the insured who has two or more policies covering the same loss from being more than indemnified

• The effect of the principle is to prevent the insured from making profit out of economic loss

• The object of the principle is to ensure that the insured, after being indemnified, shall not be better off than before the loss.

4.Payment of insurance is also called

• Premium

• Token

• Bill

• Credit

5.Life insurance can be explain as

• Motor vehicles

• Marine and aviation

• Products or goods sold

• Sickness or disability

6. A hazard is a condition that creates or increases the frequency or severity of loss. How many major types of hazards are there?

• 4

• 3

• 5

• 6

7. Strategic risk is defined as the risk associated with future business plans and strategies

• true

• false

8. The "Risk" is defined as uncertainty concerning the occurrence of a loss.

• True

• False

9.Insurance work through insurer collecting premiums from a group of people in similar circumstances

• True

• False

10. What is modified endowment policy ?

• Commonly purchased as mortgage loan companion, the idea being that the endowment maturity value will pay off the outstanding loan balance at a preset time.

• Pays upon the survival one half the sum payable on death during the endowment period.

• Provide for the premium periodically of a set percentage of the insured amount over the policy term, as well as maturity amount.

• The amount pay at death is the face amount or cash value, whichever the greater.