NAFA Risk Management Exam
Questions and Answers Top
Rated Latest Version
Question >> 1
What data elements need to be collected along with the
driver instructions?
Correct Answer
· Name
· Address
· Phone number(s)
· Driver's license number
· License plate number
· Vehicle make and model
· Name of insurance carrier
· Insurance policy number
· Name, address and phone number(s) of all parties
involved in the incident, including all passengers in each
vehicle
· Name, address and phone number(s) of all witnesses
· Date and time off the incident
· Location of the incident (intersection or route and
milespost)
· The party to whom the driver's vehicle was registered
(e.g., the organization, the driver, another individual or a
rental agency)
· Name and phone number(s) of the investigating law
enforcement officers on the scene, if any
Page 1 of 66
,· List of all entities responding to the scene (e.g., fire
department, ambulance, hazardous material unit)
· Descriptive list of all citations issued
· Space to allow the driver to make a sketch or diagram
of the incident scene
· Photos of the scene and damage (if camera is available)
Question >> 2
What are the steps in risk management process?
Correct Answer
-Determine the goal of study,
-Identify all organizational risk and exposures,
-Quantify or measure the risk in terms of potential,
-likelihood and magnitude (frequency and severity),
-examine alternative strategies for managing the risk and/or
paying for the losses that are not avoided,
-choose and prioritize the most appropriate elimination
and/or control strategies,
-plan and implement the most appropriate elimination
and/or control strategies,
-once the program is implemented, communicate the results
of the risk management process throughout the
organization,
-continually monitor the program for effectiveness and
modify as necessary
Question >> 3
What are the five essential steps involved in the repair versus
Page 2 of 66
,total decision?
Correct Answer
· Assess the damage,
· Establish vehicle pre-crash condition and worth,
· Secure and review repair estimates,
· Compare the Actual Cash Value (ACV) to repair
estimates Repair or total the vehicle
Question >> 4
What are the two types of documents needed to obtain an
MVR?
Correct Answer
· A clear and conspicuous disclosure that a report may be
requested must be provided in a separate document. The
purpose of this is to specifically prevent the disclosure from
being buried in an employment application.
The employer must obtain written consent from the
applicant. Information regulated under the Fair Credit
Reporting ACT (FCRA) now includes any information
gathered and sold that may affect an individual ability to get
or hold a job, that may have a material effect on an
individual's employment status, and a variety of other
purposes. Included under this expanded definition are MVRs
Question >> 5
Why is the impact of loss on cash flow important?
Correct Answer
Without the ability to generate cash, an entity will cease to
exist.
Page 3 of 66
, Question >> 6
What are the two factors that characterize risk?
Correct Answer
According to the probability of occurrence frequency) and
the magnitude or impact of the future loss (severity).
Question >> 7
What are two decisions traps to avoid?
Correct Answer
· Psychological phenomenon "escalation psychology",
· Loss aversion
Question >> 8
What does the insurer do upon receipt of a claim?
Correct Answer
The insurance company will typically send out an investigator
called an adjuster or appraiser to assess damage. The
insurance adjuster's job is to objectively evaluate the
insurance claim and determine if the repair estimates are
reasonable.
Question >> 9
What are some of the attributes that risk manager should
have?
Correct Answer
Sound judgmental skills to balance business and risk
requirements,
Page 4 of 66
Questions and Answers Top
Rated Latest Version
Question >> 1
What data elements need to be collected along with the
driver instructions?
Correct Answer
· Name
· Address
· Phone number(s)
· Driver's license number
· License plate number
· Vehicle make and model
· Name of insurance carrier
· Insurance policy number
· Name, address and phone number(s) of all parties
involved in the incident, including all passengers in each
vehicle
· Name, address and phone number(s) of all witnesses
· Date and time off the incident
· Location of the incident (intersection or route and
milespost)
· The party to whom the driver's vehicle was registered
(e.g., the organization, the driver, another individual or a
rental agency)
· Name and phone number(s) of the investigating law
enforcement officers on the scene, if any
Page 1 of 66
,· List of all entities responding to the scene (e.g., fire
department, ambulance, hazardous material unit)
· Descriptive list of all citations issued
· Space to allow the driver to make a sketch or diagram
of the incident scene
· Photos of the scene and damage (if camera is available)
Question >> 2
What are the steps in risk management process?
Correct Answer
-Determine the goal of study,
-Identify all organizational risk and exposures,
-Quantify or measure the risk in terms of potential,
-likelihood and magnitude (frequency and severity),
-examine alternative strategies for managing the risk and/or
paying for the losses that are not avoided,
-choose and prioritize the most appropriate elimination
and/or control strategies,
-plan and implement the most appropriate elimination
and/or control strategies,
-once the program is implemented, communicate the results
of the risk management process throughout the
organization,
-continually monitor the program for effectiveness and
modify as necessary
Question >> 3
What are the five essential steps involved in the repair versus
Page 2 of 66
,total decision?
Correct Answer
· Assess the damage,
· Establish vehicle pre-crash condition and worth,
· Secure and review repair estimates,
· Compare the Actual Cash Value (ACV) to repair
estimates Repair or total the vehicle
Question >> 4
What are the two types of documents needed to obtain an
MVR?
Correct Answer
· A clear and conspicuous disclosure that a report may be
requested must be provided in a separate document. The
purpose of this is to specifically prevent the disclosure from
being buried in an employment application.
The employer must obtain written consent from the
applicant. Information regulated under the Fair Credit
Reporting ACT (FCRA) now includes any information
gathered and sold that may affect an individual ability to get
or hold a job, that may have a material effect on an
individual's employment status, and a variety of other
purposes. Included under this expanded definition are MVRs
Question >> 5
Why is the impact of loss on cash flow important?
Correct Answer
Without the ability to generate cash, an entity will cease to
exist.
Page 3 of 66
, Question >> 6
What are the two factors that characterize risk?
Correct Answer
According to the probability of occurrence frequency) and
the magnitude or impact of the future loss (severity).
Question >> 7
What are two decisions traps to avoid?
Correct Answer
· Psychological phenomenon "escalation psychology",
· Loss aversion
Question >> 8
What does the insurer do upon receipt of a claim?
Correct Answer
The insurance company will typically send out an investigator
called an adjuster or appraiser to assess damage. The
insurance adjuster's job is to objectively evaluate the
insurance claim and determine if the repair estimates are
reasonable.
Question >> 9
What are some of the attributes that risk manager should
have?
Correct Answer
Sound judgmental skills to balance business and risk
requirements,
Page 4 of 66
