Principles and practice of insurance ( CIP ) UPDATED
ACTUAL Questions and CORRECT Answers
,What is the Acronym - Radar of Palms RADAR
Register maintained for each licensed company with information on company,
directors, and auditors. (1.)
Assets must be valued as prescribed by the Act. (5)
Directing a company to refrain from or change practices when contravening a
provision of the Act. (11)
Annual return report must be filed by company's actuary. (7)
Restrictions on types of investments which can be made. Lending and investment
policy standards are provided under the Act. (3)
Page 3-5
OF
Office inspections are carried out by representatives of the superintendent at
least once during each calendar year. (10)
Failure to comply with directives may result in loss of control of the company or
liquidation of it by the superintendent. (12)
Page 3-5
PALMS
Prepare an annual return of the condition and affairs of the company at end of
each financial year. (4)
Auditor must file a report with the annual return stating whether the return is
fairly presented as to the financial position of the company. (8)
L
insurance A contract whereby one party (insurer) agrees to indemnify or guarantee another
party (insured) against a loss by a specified future contingency or peril in return
for payment of a premium.
risk chance of loss
Speculative Risk A chance of loss or a chance of gain.
ex : game of dice
Pure Risk A chance of loss or no loss, but no chance of gain.
, what type of risk insurance cover Pure risk
ex :
1. is there a chance of loss -> answer must be YES
2. is there a chance of profit -> answer must be NO
what are the different type of insurable risk? 1. Personal risk
2. property risks
3. liability risks
2 types of loss arising from property risk 1. Direct losses = cost of repairing, replacing, rebuilding
2. Indirect loss = loss of rental income
what is a peril? the even that cause a loss
example: fire or windstorm
Proximate cause the cause immediate and effective cause of the loss (ruth cause of the loss)
explanation: there must exist an uninterrupted unfolding of event, without the
intervention of another main cause.
what are the 3 types of General Insurance? Personal lines (most common): private dwelling, automobile, boat, jewelry, furs,
vacation etc.
Commercial lines: store, office, business
Special risks: exposure, aviation and high-risk industrial operations.
Which of the following is an automobile statutory d. Material change in risk.
condition?
a. Overpayment of insurance premium
b. Degree of injury suffered
c. Contract wording bias
d. Material change in risk
What is the purpose of the Personal Information d. To balance individuals' privacy rights with the need of organizations to collect,
Protection and Electronic Documents Act? use, or disclose personal information for reasonable and appropriate purposes.
a. To bring about change in the insurance industry
b To overrule the principles of indemnity
c. To assist in the growth of the insurance organization
d. To balance individuals' privacy rights with the need of
organizations to collect, use, or disclose personal
information for reasonable and appropriate purposes
ACTUAL Questions and CORRECT Answers
,What is the Acronym - Radar of Palms RADAR
Register maintained for each licensed company with information on company,
directors, and auditors. (1.)
Assets must be valued as prescribed by the Act. (5)
Directing a company to refrain from or change practices when contravening a
provision of the Act. (11)
Annual return report must be filed by company's actuary. (7)
Restrictions on types of investments which can be made. Lending and investment
policy standards are provided under the Act. (3)
Page 3-5
OF
Office inspections are carried out by representatives of the superintendent at
least once during each calendar year. (10)
Failure to comply with directives may result in loss of control of the company or
liquidation of it by the superintendent. (12)
Page 3-5
PALMS
Prepare an annual return of the condition and affairs of the company at end of
each financial year. (4)
Auditor must file a report with the annual return stating whether the return is
fairly presented as to the financial position of the company. (8)
L
insurance A contract whereby one party (insurer) agrees to indemnify or guarantee another
party (insured) against a loss by a specified future contingency or peril in return
for payment of a premium.
risk chance of loss
Speculative Risk A chance of loss or a chance of gain.
ex : game of dice
Pure Risk A chance of loss or no loss, but no chance of gain.
, what type of risk insurance cover Pure risk
ex :
1. is there a chance of loss -> answer must be YES
2. is there a chance of profit -> answer must be NO
what are the different type of insurable risk? 1. Personal risk
2. property risks
3. liability risks
2 types of loss arising from property risk 1. Direct losses = cost of repairing, replacing, rebuilding
2. Indirect loss = loss of rental income
what is a peril? the even that cause a loss
example: fire or windstorm
Proximate cause the cause immediate and effective cause of the loss (ruth cause of the loss)
explanation: there must exist an uninterrupted unfolding of event, without the
intervention of another main cause.
what are the 3 types of General Insurance? Personal lines (most common): private dwelling, automobile, boat, jewelry, furs,
vacation etc.
Commercial lines: store, office, business
Special risks: exposure, aviation and high-risk industrial operations.
Which of the following is an automobile statutory d. Material change in risk.
condition?
a. Overpayment of insurance premium
b. Degree of injury suffered
c. Contract wording bias
d. Material change in risk
What is the purpose of the Personal Information d. To balance individuals' privacy rights with the need of organizations to collect,
Protection and Electronic Documents Act? use, or disclose personal information for reasonable and appropriate purposes.
a. To bring about change in the insurance industry
b To overrule the principles of indemnity
c. To assist in the growth of the insurance organization
d. To balance individuals' privacy rights with the need of
organizations to collect, use, or disclose personal
information for reasonable and appropriate purposes
