CAIB 1 EXAM QUESTIONS WITH
CORRECT ANSWERS
Risk - ANSWER✔✔✔-the chance of financial loss to which an object of
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insurance is exposed | |
Speculative Risk - ANSWER✔✔✔-possibility of financial loss or gain
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Pure Risk - ANSWER✔✔✔-Chance of financial loss, no gain
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Insurance - ANSWER✔✔✔-undertaking by one person to indemnify
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another person against loss or liability for loss in respect of a certain risk
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|or peril to which the object of insurance may be exposed or to pay a
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sum of money or other ting of value upon the happening of a certain
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event
Contract - ANSWER✔✔✔-an agreement between two or more persons
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which creates an obligation to do or not to do a particular thing
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Insurable Interest - ANSWER✔✔✔-showing you would suffer financially
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by a loss
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, Utmost good faith - ANSWER✔✔✔-caveat emptor, buyer beware.
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Exercise a higher standard of honesty
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Indemnity - ANSWER✔✔✔-putting the insured back into the same
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position as they were in as immediately prior to loss
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Binder - ANSWER✔✔✔-Contract of insurace
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Agency Agreement - ANSWER✔✔✔-source of a brokers authority
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Void - ANSWER✔✔✔-Unable to support its intended purpose, treated
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as though it never existed
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Voidable - ANSWER✔✔✔-void to the wrongdoer but not to the
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wronged party unless they elect to treat it so
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Peril - ANSWER✔✔✔-The cause of a loss
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Direct Loss - ANSWER✔✔✔-When the object of insurance is the loss
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Indirect loss - ANSWER✔✔✔-Losses which arise as a consequence of a
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direct loss
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CORRECT ANSWERS
Risk - ANSWER✔✔✔-the chance of financial loss to which an object of
| | | | | | | | | | | |
insurance is exposed | |
Speculative Risk - ANSWER✔✔✔-possibility of financial loss or gain
| | | | | | | |
Pure Risk - ANSWER✔✔✔-Chance of financial loss, no gain
| | | | | | | |
Insurance - ANSWER✔✔✔-undertaking by one person to indemnify
| | | | | | | |
another person against loss or liability for loss in respect of a certain risk
| | | | | | | | | | | | |
|or peril to which the object of insurance may be exposed or to pay a
| | | | | | | | | | | | | | |
sum of money or other ting of value upon the happening of a certain
| | | | | | | | | | | | | |
event
Contract - ANSWER✔✔✔-an agreement between two or more persons
| | | | | | | | |
which creates an obligation to do or not to do a particular thing
| | | | | | | | | | | |
Insurable Interest - ANSWER✔✔✔-showing you would suffer financially
| | | | | | | |
by a loss
| |
, Utmost good faith - ANSWER✔✔✔-caveat emptor, buyer beware.
| | | | | | | |
Exercise a higher standard of honesty
| | | | |
Indemnity - ANSWER✔✔✔-putting the insured back into the same
| | | | | | | | |
position as they were in as immediately prior to loss
| | | | | | | | |
Binder - ANSWER✔✔✔-Contract of insurace
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Agency Agreement - ANSWER✔✔✔-source of a brokers authority
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Void - ANSWER✔✔✔-Unable to support its intended purpose, treated
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as though it never existed
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Voidable - ANSWER✔✔✔-void to the wrongdoer but not to the
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wronged party unless they elect to treat it so
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Peril - ANSWER✔✔✔-The cause of a loss
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Direct Loss - ANSWER✔✔✔-When the object of insurance is the loss
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Indirect loss - ANSWER✔✔✔-Losses which arise as a consequence of a
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direct loss
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