Insurance and Risk Management MCQS WITH ANSWERS

Insurance and Risk Management

4 1. The principles of indemnity does not apply to ______________.

1. Burglary insurance
2. Fire insurance
3. Marine insurance
4. Life and Personal Accident insurance

Correct answer: (D)
Life and Personal Accident insurance

42. The risk that arises because of magnitude of cash flow due to change in output and input prices is known as ______________.

1. Credit risk
2. Particular risk
3. Business risk
4. Price risk

Correct answer: (D)
Price risk

43. Cost of risk has the following components ______________.

1. Cost of Expected Losses and Cost of Control of Loss
2. Cost of Expected Losses and Cost of Loss Financing
3. Cost of Control of Loss and Cost of Loss Financing
4. Cost of Expected Loss, Cost of Control of Loss Cost of Financing, Cost of Residual Uncertainity

Correct answer: (D)
Cost of Expected Loss, Cost of Control of Loss Cost of Financing, Cost of Residual Uncertainity

44. If RMIS has the problem of incompatibility of software then the remedy is to provide ______________.

1. solid vendor account team
2. internal access to system expert
3. clear and comprehensive specifications
4. financial check

Correct answer: (C)
clear and comprehensive specifications

45. To avoid RMIS being obsolete provide ______________.

1. solid vendor account team
2. internal access to system expert
3. standard software configuration
4. clear and comprehensive specifications

Correct answer: (C)
standard software configuration

46. The process of reducing the level of risky activities firstly affect the frequency of losses is the strategy of ______________.

1. Risk avoidance
2. Retention
3. Hedging
4. Other contractual risk transfer

Correct answer: (A)
Risk avoidance

47. Which of the statements is correct? a. Insurance is a transfer of risk mechanism. b. Insurance gives physical protection to assets.

1. Statement A
2. Statement B
3. Both the statements
4. Neither of the statements

Correct answer: (A)
Statement A

48. A complete proposal form contains information about ______________.

1. Moral hazard
2. Physical hazard
3. Personal history of proposer and identify of the property insurance
4. All of the above

Correct answer: (B)
Physical hazard

49. This policy covers all risks to the ship and its cargo while the ship is at a particular port ______________.

1. Voyage policy
2. Floating policy
3. Time policy
4. Portrisk Policy

Correct answer: (D)
Portrisk Policy

50. _______________ policy matures on the assured death or on his attainment of a particular age whichever occurs earlier.

1. Endowment
2. Money back
3. Joint life
4. Single premium

Correct answer: (A) Endowment 

MCQs With Answers

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