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Basic Insurance Concepts & Principles - exampdfs 01

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Basic Insurance Concepts & Principles - exampdfs 01

Questão 1 de 50

1

The Insurance market comprises:
1) buyers
2) sellers
3) intermediaries

Selecione uma das seguintes:

  • 1, 2

  • 1, 3

  • 2, 3

  • 1, 2, 3

Explicação

Questão 2 de 50

1

An example of a Seller in an insurance market is/are:

Selecione uma das seguintes:

  • Life Insurance Association

  • Insurance companies

  • Insurance agents

  • Insurance brokers

Explicação

Questão 3 de 50

1

Which of the following is not classified as Commercial General Insurance?

Selecione uma das seguintes:

  • Professional Indemnity Insurance

  • Marine Cargo Insurance

  • Personal Liability Insurance

  • Work Injury Compensation Insurance

Explicação

Questão 4 de 50

1

Microinsurance provides a variety of different risks, including illnesses, accidental bodily injuries, death and property loss, designed for the affordability and accessibility to low-income households.

Selecione uma das opções:

  • VERDADEIRO
  • FALSO

Explicação

Questão 5 de 50

1

It is mandatory for Takaful insurance to be compliant with Shariah and the Islamic law.

Selecione uma das opções:

  • VERDADEIRO
  • FALSO

Explicação

Questão 6 de 50

1

Which of the following is an example of pure risk?

Selecione uma das seguintes:

  • Being robbed

  • Running a business

  • Earthquake

  • Driving a car

Explicação

Questão 7 de 50

1

Which of the following is NOT an example of fundamental risk?

Selecione uma das seguintes:

  • War

  • Flood

  • Driving a car

  • Unemployment

Explicação

Questão 8 de 50

1

Which of the following is NOT a category of any type of insurance contract?

Selecione uma das seguintes:

  • Contract of Insurability

  • Contract of Indemnity

  • Valued contract

  • Benefit contract

Explicação

Questão 9 de 50

1

Which of the following is NOT commonly insured under a valued contract?

Selecione uma das seguintes:

  • Marine insurance

  • Antique insurance

  • Jewelry Insurance

  • Personal Accident Insurance

Explicação

Questão 10 de 50

1

Which of the following is commonly classified as a contract of indemnity?

Selecione uma das seguintes:

  • Marine insurance

  • Endowment insurance

  • Fire Insurance

  • Personal Accident Insurance

Explicação

Questão 11 de 50

1

Which of the following is commonly classified as a benefit contract?

Selecione uma das seguintes:

  • Marine insurance

  • Antique insurance

  • Fire Insurance

  • Personal Accident Insurance

Explicação

Questão 12 de 50

1

Which of the following types of loss is NOT insurable?

Selecione uma das seguintes:

  • Loss that is accidental

  • Loss that is definite

  • Loss that creates a burden

  • Loss that happens to a large number of insureds at the same time

Explicação

Questão 13 de 50

1

What is a peril?

Selecione uma das seguintes:

  • An event or occurrence which causes a loss, an injury or damage

  • An event or occurrence that creates or increases the risk of loss

  • An event or occurrence whereby people, through their careless or irresponsible action creates or increases the risk of loss

  • All of the others

Explicação

Questão 14 de 50

1

In insurance, which of the following is NOT a type of hazard?

Selecione uma das seguintes:

  • Moral hazard

  • Physical hazard

  • Accidental hazard

  • None of the others

Explicação

Questão 15 de 50

1

A moral hazard can involve a situation in which a person engineers a loss on purpose in order to make a false claim against an insurance company.

Selecione uma das opções:

  • VERDADEIRO
  • FALSO

Explicação

Questão 16 de 50

1

Which of the following is NOT a method of risk control?

Selecione uma das seguintes:

  • Avoidance

  • Confine

  • Retention

  • Transfer

Explicação

Questão 17 de 50

1

Which of the following is a type of risk retention whereby one is aware of a risk and intentionally retains it, or a portion of it:

Selecione uma das seguintes:

  • Active retention

  • Passive retention

  • Self retention

  • Insurance retention

Explicação

Questão 18 de 50

1

Which of the following clauses are usually used in a contract so that one party will assume legal liability on behalf of another party?

Selecione uma das seguintes:

  • Assumption clause

  • Zero-liability clause

  • Zero-responsibility clause

  • Hold-harmless clause

Explicação

Questão 19 de 50

1

Which of the following is a method to use such that a risk and its potential financial consequences can be transferred to another party without the use of insurance?

Selecione uma das seguintes:

  • Risk transfer

  • Risk pooling

  • Non-insurance transfer

  • Non-insurance pooling

Explicação

Questão 20 de 50

1

Non-insurance transfer methods are usually used in which type of contacts?

Selecione uma das seguintes:

  • Building construction

  • Personal Accident Insurance

  • Motor Vehicle Insurance

  • None of the others

Explicação

Questão 21 de 50

1

Which of the following are benefits of insurance?

Selecione uma das seguintes:

  • Enhance provision of credit facilities

  • Stimulates business enterprise

  • Encourages investments

  • All of the others

Explicação

Questão 22 de 50

1

What is insurable interest?

Selecione uma das seguintes:

  • The legal right to insure

  • The amount of compensation

  • The real reason for the loss

  • The insured

Explicação

Questão 23 de 50

1

What is subrogation?

Selecione uma das seguintes:

  • The legal right to insure

  • The legal right to recovery

  • The real reason for the loss

  • The amount of compensation

Explicação

Questão 24 de 50

1

Which of the following is NOT TRUE about 'common law'?

Selecione uma das seguintes:

  • It is sometimes called 'unwritten law'

  • It consists of generally accepted rules and requirements that a civilized society will consider automatic

  • It can be modified or abolished by statute law

  • It cannot be modified by the mutual agreement of parties to a contract

Explicação

Questão 25 de 50

1

Which of the following is NOT essential to insurable interest?

Selecione uma das seguintes:

  • There must be some property, rights, interest or potential liability capable of being insured

  • The property, rights, interest or potential liability must be the subject matter of the insurance

  • The insured must not stand in a relationship, recognized by law, with the subject matter of the insurance

  • The proposer must benefit from the continued existence of the subject matter of the contract or be prejudiced by its loss

Explicação

Questão 26 de 50

1

Which of the following types of insurance contracts do not need proof of existence of insurable interest at the time that the policy is issued?

Selecione uma das seguintes:

  • Non-life and non-marine contracts

  • Life insurance

  • Marine insurance

  • None of the others

Explicação

Questão 27 de 50

1

Which of the following relationships do not have an insurable interest?

Selecione uma das seguintes:

  • Husband and wife

  • Employee and employer

  • Debtor and creditor

  • None of the others

Explicação

Questão 28 de 50

1

The doctrine of utmost good faith imposes which of the following duties on the parties to the contract?

Selecione uma das seguintes:

  • 1) A duty not to misrepresent any matter relating to the insurance

  • 2) A duty to disclose all material facts relating to the contract

  • Both 1) and 2)

  • None of the others

Explicação

Questão 29 de 50

1

Which of the following can be influenced by a material fact?

Selecione uma das seguintes:

  • An underwriter's decision to accept a risk

  • Premium

  • Terms and conditions of the insurance contract

  • All of the others

Explicação

Questão 30 de 50

1

Facts of law do not need to be disclosed as material facts because everyone is expected to know the law.

Selecione uma das opções:

  • VERDADEIRO
  • FALSO

Explicação

Questão 31 de 50

1

Duty of disclosure commences at all of the following times EXCEPT the:

Selecione uma das seguintes:

  • Beginning of negotiations

  • Inception of policy

  • After inception

  • None of the others

Explicação

Questão 32 de 50

1

Duty of disclosure arises under:

Selecione uma das seguintes:

  • 1) Common law

  • 2) The policy terms

  • Both 1) and 2)

  • None of the others

Explicação

Questão 33 de 50

1

Duty of disclosure is only applicable to the:

Selecione uma das seguintes:

  • Insured

  • Insurer

  • Both Insured and Insurer

  • None of the others

Explicação

Questão 34 de 50

1

For a fact to be considered as a misrepresentation, it must:

Selecione uma das seguintes:

  • induce the contract

  • not be made by a party to the contract

  • not cause some loss or disadvantage to the person who has relied upon it

  • All of the others

Explicação

Questão 35 de 50

1

Which of the following is NOT a type of misrepresentation?

Selecione uma das seguintes:

  • Fraudulent

  • Innocent

  • Material

  • Negligent

Explicação

Questão 36 de 50

1

A proposer applying for life insurance says that he is in good health when he knows that he is suffering from a serious illness is guilty of:

Selecione uma das seguintes:

  • misrepresentation

  • non-disclosure

  • Both misrepresentation and non-disclosure

  • None of the others

Explicação

Questão 37 de 50

1

Fraudulent non-disclosure is also known as:

Selecione uma das seguintes:

  • Concealment

  • Mitigation

  • Negligence

  • Subrogation

Explicação

Questão 38 de 50

1

If innocent misrepresentation by the insured is present, the insurer has the right to:

Selecione uma das seguintes:

  • Claim damages

  • Keep any premium paid

  • Allow the contract to stand

  • All of the others

Explicação

Questão 39 de 50

1

An insurer can refuse to pay a particular claim but at the same time allow the contract to stand only if:

Selecione uma das seguintes:

  • 1) The insured is guilty of fraudulent misrepresentation

  • 2) The insured is guilty of innocent misrepresentation

  • Both 1) and 2)

  • None of the others

Explicação

Questão 40 de 50

1

Which of the following is a method by which an insurer can provide the insured with the necessary indemnity?

Selecione uma das seguintes:

  • Repair

  • Replacement

  • Reinstatement

  • All of the others

Explicação

Questão 41 de 50

1

The principle of indemnity can be applied to which of the following classes of insurance?
1) Property insurance
2) Pecuniary insurance
3) Personal Accident insurance
4) Life insurance

Selecione uma das seguintes:

  • 1) and 2)

  • 2), 3), 4)

  • 3) and 4)

  • All of them

Explicação

Questão 42 de 50

1

When insuring machinery and equipment, which of the following is TRUE about how a second-hand market will affect the amount insured?

Selecione uma das seguintes:

  • 1) If there is a ready second-hand market, the indemnity is the cost of the second-hand item less any additional transport and installation costs

  • 2) If there is no second-hand market, the indemnity is the cost of repair or replacement less an allowance for wear and tear, if applicable

  • Both 1) and 2)

  • None of the others

Explicação

Questão 43 de 50

1

Which of the following falls under Pecuniary Insurance?

Selecione uma das seguintes:

  • Life insurance

  • Personal Accident insurance

  • Theft insurance

  • Liability insurance

Explicação

Questão 44 de 50

1

Which of the following are factors that limit the amount of indemnity?

Selecione uma das seguintes:

  • Average clause

  • Agreed Value clause

  • Reinstatement clause

  • "New for old" clause

Explicação

Questão 45 de 50

1

Which of the following are extensions that increase the amount of indemnity?

Selecione uma das seguintes:

  • Franchise

  • Average clauses

  • Agreed Value clause

  • Excess

Explicação

Questão 46 de 50

1

Oriental Trading Company had a fire in its insured shop. They claimed a loss of $5000 against its Fire Insurance policy. The loss adjuster who was instructed by the insurer was satisfied that the loss claimed was correct. However the loss adjuster reported that, in his opinion, there was at least $10,000 in stock but only $8000 in insurance cover. If the policy was NOT subject to average clause, how much should the insurer pay?

Selecione uma das seguintes:

  • $2000

  • $4000

  • $5000

  • $8000

Explicação

Questão 47 de 50

1

New World Trading Company had a fire in its insured shop. They claimed a loss of $9000 against the Fire Insurance policy. The loss adjuster who was instructed by the insurer was satisfied that the loss claimed was correct. However the loss adjuster reported that, in his opinion, there was at least $30,000 in stock but only $20,000 in insurance cover. If the policy was subject to average clause, how much should the insurer pay?

Selecione uma das seguintes:

  • $3000

  • $6000

  • $9000

  • $11000

Explicação

Questão 48 de 50

1

Which of the following is similar to an Excess but once the Excess is exceeded, the loss is payable in full?

Selecione uma das seguintes:

  • Average Clause

  • Franchise

  • Limit of Liability

  • Deductible

Explicação

Questão 49 de 50

1

Extensions are added to a policy, so that:

Selecione uma das seguintes:

  • The insured can recover more than a strict indemnity

  • The insurer pays less than the strict indemnity

  • The premium is lower

  • The policy can be extended to cover for a longer period of time

Explicação

Questão 50 de 50

1

Which of the following clauses is NOT categorized as an extension?

Selecione uma das seguintes:

  • Reinstatement Clause

  • "New for Old" Clause

  • Limit of Liability Clause

  • Agreed Value Clause

Explicação

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