Insurance Quiz

Who is the person that provides insurance?

• Insurer/Underwriter

• Beneficiary

• Insured

• Assessor/Actuaries

Answer explanation

The person that provides insurance is known as the Insurer/Underwriter, who assesses risks and provides coverage in exchange for premiums.

What is the amount promised by the insurer to pay at the maximum?

• Cover Note

• Sum Insured

• Premium

• Claim form

Answer explanation

The amount promised by the insurer to pay at the maximum is known as the Sum Insured, which represents the coverage limit for the policy.

What is the document that acts as proof of insurance before the insurance policy is issued?

• Insurance Policy

• Claim form

• Proposal form

• Cover Note

Answer explanation

The correct choice is 'Cover Note' as it acts as proof of insurance before the insurance policy is issued.

What is the main reason for obtaining insurance cover?

• To make a profit

• To avoid paying premiums

• To protect against losses

• To increase risk

Answer explanation

The main reason for obtaining insurance cover is to protect against losses, not to make a profit, avoid paying premiums, or increase risk.

How does insurance work based on the pooling of risks?

• Insurance companies keep all the premiums for themselves

• Money collected from many people is used to compensate the few who suffer losses

• Each individual pays for their own losses

• Premiums are refunded to all customers

Answer explanation

Money collected from many people is used to compensate the few who suffer losses

What type of risk is fire damage considered under insurance?

• Insurable Risks

• Uninsurable Risks

• Non-insurable Risks

• Accident risks

Answer explanation

Fire damage is considered under insurable risks because it is a type of risk that insurance companies are willing to provide coverage for.

Which insurance policy provides compensation for accidental damage to ships?

• Marine risks and insurances

• Aviation Insurance

• Accident risks Insurance

• Life Insurance

Answer explanation

The correct choice is Marine risks and insurances, as it provides compensation for accidental damage to ships.

What does the principle of Utmost Good Faith in insurance mean?

• Insured should profit from a loss

• Honesty between insurer and insured

• Insured should conceal information

• Insured can claim multiple times for the same loss

Answer explanation

The principle of Utmost Good Faith in insurance means honesty between insurer and insured, emphasizing the importance of full disclosure and transparency.

What is the main stage involved in making an insurance claim after a loss occurs?

• Receive a cover note

• Claim form

• Request for an insurance quotation

• Compensation received

Answer explanation

The main stage involved in making an insurance claim after a loss occurs is filling out a claim form.

What is the role of an insurance broker?

• To assess risks

• To invest premiums

• To negotiate insurance terms on behalf of the insured

• To provide medical assistance

Answer explanation

The role of an insurance broker is to negotiate insurance terms on behalf of the insured, ensuring they get the best coverage and rates.