Insurance

1. The concept of indemnity is based on the key principle that policyholders should be prevented from

Insuring existing losses
Making false insurance claims
Paying excessively for insurance cover
Profiting from insurance

Detailed SolutionThe concept of indemnity is based on the key principle that policyholders should be prevented from

2. Arun started a 20-year term insurance policy. Once established, when, if at all, is the insurer next entitled to ask him for proof of continuing good health?

At no point
After the end of the first 12 months
At the point when he changes occupation or retires
When a lapsed policy is revived

Detailed SolutionArun started a 20-year term insurance policy. Once established, when, if at all, is the insurer next entitled to ask him for proof of continuing good health?

3. For a household insurance policy, insurable interest need only exist at outset and at what other point?

The date the cancellation period expires
The date a claim occurs
The date the policy document is received
The termination date

Detailed SolutionFor a household insurance policy, insurable interest need only exist at outset and at what other point?

4. How are perils and hazards normally distinguished under term insurance policies?

Perils are medical factors which influence the risk of dying and hazards are lifestyle activities which influence the risk of dying
Perils are risks that policyholders will die before a specified date and hazards are factors which could influence that risk
Perils are factors which affect the risk being insured and hazards are the size of the risk being insured
Perils are factors which could influence an insured event occurring and hazards are the actual events which will trigger a payout

Detailed SolutionHow are perils and hazards normally distinguished under term insurance policies?

5. In insurance terms, the risk of suffering a disability is best described as what type of risk?

Financial
Fundamental
Homogenous
Speculative

Detailed SolutionIn insurance terms, the risk of suffering a disability is best described as what type of risk?

6. Akshat is a relatively cautious person. In insurance terms, this will normally increase the likelihood that he will

Be considered an above average insurance risk
Be considered a below average insurance risk
Require insurance cover
Require reinsurance cover

Detailed SolutionAkshat is a relatively cautious person. In insurance terms, this will normally increase the likelihood that he will

7. The main role of an underwriter in a non-life insurance company is normally to

Assess the acceptability of particular risks
Certify a loss when claims are submitted
Design the structure of the products to be offered
Negotiate with the industry regulator

Detailed SolutionThe main role of an underwriter in a non-life insurance company is normally to

8. Rakesh recently bought a health insurance policy and a personal accident policy. What main section(s) of the insurance market do these products normally fall into?

Life insurance in both cases
Life insurance for health and non-life insurance for personal accident
Non-life insurance in both cases
Non-life insurance for health and life insurance for personal accident

Detailed SolutionRakesh recently bought a health insurance policy and a personal accident policy. What main section(s) of the insurance market do these products normally fall into?

9. The concept of insurance involves a transfer of

Liability
Needs
Ownership
Risk

Detailed SolutionThe concept of insurance involves a transfer of

10. A single policy covering a group of individuals, usually employees of the same company or members of the same association and their dependants is called _________

Hospital Insurance
Hull Insurance
Group Insurance
Identity theft Insurance

Detailed SolutionA single policy covering a group of individuals, usually employees of the same company or members of the same association and their dependants is called _________

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