Insurance in International Trade Quiz

What kind of insurance plays the most vital role in international trade?

• Marine insurance

• Aviation Insurance

• Fire and Special Perils Insurance

• Erection all risks (EAR) insurance

How many types of marine insurance are there?

• 2

• 3

• 4

• 5

Marine insurance cannot be customized to include coverage for specific routes, cargo types, or additional risks like war or strike.

• TRUE

• FALSE

Who is the "insured" in an insurance contract?

• The person or company who sells insurance

• The company that regulates insurance policies

• The person or business that receives protection

• The government that collects premiums

What is a "premium" in insurance?

• The total amount of goods being shipped

• A high-quality insurance policy

• The amount of risk in the supply chain

• The payment made by the insured to the insurer

Why is insurance especially important in international trade?

• Because trade policies require it by law

• Because it helps recover losses from unpredictable risks during transportation

• Because shipping companies offer it for free

• Because it increases taxes on imported goods

What is an actual total loss in marine insurance?

• When the cargo is delivered late to the destination

• When the cargo or ship is completely destroyed or lost at sea

• When the owner refuses to pay insurance

• When the cargo is slightly damaged during unloading

What is the main difference between Particular Average and General Average?

• Particular Average is covered by the government, General Average is not

• Particular Average is shared by all cargo owners, General Average is not

• Particular Average affects one party only, General Average involves shared sacrifice

• Particular Average occurs only in international waters

Which situation describes a Constructive Total Loss?

• The ship is temporarily delayed due to weather

• The cargo has minor cosmetic damage

• The ship is damaged and the cost of repair is higher than its value

• The cargo is returned to the sender due to customs issues

Which of the following qualifies as a General Average act?

• Captain throws cargo overboard during a storm to save the ship

• Crew accidentally drops a container while unloading

• One shipper's cargo catches fire due to poor packaging

• Cargo is lost due to pirate attack