ISR3701
EXAM PACK
+27 81 278 3372
, CONFIDENTIAL
Page 1 of 12 RSK3701
MAY/JUNE 2020
UNIVERSITY EXAMINATIONS
May/June 2020
RSK3701
RISK FINANCING AND SHORT-TERM INSURANCE
40 Marks
Duration: 1 Hour 30 Minutes
This paper consists of 16 pages.
Instructions:
This paper comprises of 40 multiple-choice questions. You are advised to download the exam
question paper and either save it or print. This is to safeguard against the loss of an internet
connection whilst you are attempting the questions. Once you have completed answering the
questions you will then submit your answers on myUnisa in the same manner that you did with your
assignments. The answers must be recorded on myUNISA. Do not email your solutions.
You are also reminded that this examination is a CLOSED BOOK assessment. Further, you also
undertake to observe the examination rules and regulations of the University of South Africa and
shall observe honesty and integrity at all times in attempting this assessment.
SUBMISSION OF THE EXAMINATION ANSWERS
The examination has been allocated a unique number to identify it in the UNISA assessment plans.
To submit your solutions to the multiple-choice questions via myUnisa:
▪ Go to myUnisa at https://my.unisa.ac.za
▪ Log in with your student number and password.
▪ Select the module.
▪ Click on assignments in the left-hand menu.
▪ Click on the assignment number you want to submit.
▪ Follow the instructions on the screen.
[TURNOVER]
, CONFIDENTIAL
Page 2 of 12 RSK3701
MAY/JUNE 2020
Question 1
The financial statements of the business show a low concentration of inventory at the
beginning of its sales cycle with an equally low concentration of receivables at the end of the
sales cycle. The inventory and receivable levels are indicative of …
1. a stable liquidity position throughout the sales cycle.
2. a strained working capital position at the beginning of the sales cycle.
3. a good solvency position throughout the sales cycle.
4. an unfavourable asset test ratio at the beginning of the sales cycle.
Question 2
Glass insurance …
1. provides no cover for plate glass shop counters.
2. covers the cost of boarding up windows after a loss.
3. provides no cover for mirrors.
4. is not subject to average.
Question 3
Mr Mapaile bought an expensive diamond ring for his wife for her birthday. She only intends
to wear the ring daily. The ring will be kept in a safe at their home when she is not wearing it.
In this case Mr Mapaile would be wise to insure the ring under the … section of his short-term
policy.
1. All risks
2. Houseowners
3. Householders
4. Liability
[TURNOVER]
, CONFIDENTIAL
Page 3 of 12 RSK3701
MAY/JUNE 2020
Question 4
In terms of marine insurance, perils on the sea refer to …
a Jettison.
b Barratry.
c Stranding.
d Collision.
Choose the correct combination:
1. a,b
2. c,d
3. a,c,d
4. a,b,c,d
Question 5
An insurer has a stop loss treaty for 80% of any access of claims over 70% of premiums in
any one year up to 100%. The insurer has R20 000 000 premium income and losses amount
to R18 000 000. The stop loss treaty will pay …
1. R14 000 000.
2. R18 000 000.
3. R 4 000 000.
4. R 3 200 000.
Question 6
Indicate the correct statement:
1. No age restrictions apply to Personal Accident cover.
2. Personal Accident policies provide cover for accidents and illnesses.
3. Personal Accident policies are policies of compensation.
4. Temporary disablement due to an accident will not be covered under a Personal
Accident policy.
[TURNOVER]
EXAM PACK
+27 81 278 3372
, CONFIDENTIAL
Page 1 of 12 RSK3701
MAY/JUNE 2020
UNIVERSITY EXAMINATIONS
May/June 2020
RSK3701
RISK FINANCING AND SHORT-TERM INSURANCE
40 Marks
Duration: 1 Hour 30 Minutes
This paper consists of 16 pages.
Instructions:
This paper comprises of 40 multiple-choice questions. You are advised to download the exam
question paper and either save it or print. This is to safeguard against the loss of an internet
connection whilst you are attempting the questions. Once you have completed answering the
questions you will then submit your answers on myUnisa in the same manner that you did with your
assignments. The answers must be recorded on myUNISA. Do not email your solutions.
You are also reminded that this examination is a CLOSED BOOK assessment. Further, you also
undertake to observe the examination rules and regulations of the University of South Africa and
shall observe honesty and integrity at all times in attempting this assessment.
SUBMISSION OF THE EXAMINATION ANSWERS
The examination has been allocated a unique number to identify it in the UNISA assessment plans.
To submit your solutions to the multiple-choice questions via myUnisa:
▪ Go to myUnisa at https://my.unisa.ac.za
▪ Log in with your student number and password.
▪ Select the module.
▪ Click on assignments in the left-hand menu.
▪ Click on the assignment number you want to submit.
▪ Follow the instructions on the screen.
[TURNOVER]
, CONFIDENTIAL
Page 2 of 12 RSK3701
MAY/JUNE 2020
Question 1
The financial statements of the business show a low concentration of inventory at the
beginning of its sales cycle with an equally low concentration of receivables at the end of the
sales cycle. The inventory and receivable levels are indicative of …
1. a stable liquidity position throughout the sales cycle.
2. a strained working capital position at the beginning of the sales cycle.
3. a good solvency position throughout the sales cycle.
4. an unfavourable asset test ratio at the beginning of the sales cycle.
Question 2
Glass insurance …
1. provides no cover for plate glass shop counters.
2. covers the cost of boarding up windows after a loss.
3. provides no cover for mirrors.
4. is not subject to average.
Question 3
Mr Mapaile bought an expensive diamond ring for his wife for her birthday. She only intends
to wear the ring daily. The ring will be kept in a safe at their home when she is not wearing it.
In this case Mr Mapaile would be wise to insure the ring under the … section of his short-term
policy.
1. All risks
2. Houseowners
3. Householders
4. Liability
[TURNOVER]
, CONFIDENTIAL
Page 3 of 12 RSK3701
MAY/JUNE 2020
Question 4
In terms of marine insurance, perils on the sea refer to …
a Jettison.
b Barratry.
c Stranding.
d Collision.
Choose the correct combination:
1. a,b
2. c,d
3. a,c,d
4. a,b,c,d
Question 5
An insurer has a stop loss treaty for 80% of any access of claims over 70% of premiums in
any one year up to 100%. The insurer has R20 000 000 premium income and losses amount
to R18 000 000. The stop loss treaty will pay …
1. R14 000 000.
2. R18 000 000.
3. R 4 000 000.
4. R 3 200 000.
Question 6
Indicate the correct statement:
1. No age restrictions apply to Personal Accident cover.
2. Personal Accident policies provide cover for accidents and illnesses.
3. Personal Accident policies are policies of compensation.
4. Temporary disablement due to an accident will not be covered under a Personal
Accident policy.
[TURNOVER]
