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IF1 Mock Exam 2024 (latest update) questions well answered
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IF1 Mock Exam 2024 (latest update)questions well answered
When assessing a property risk, the building materials used for construction would be considered to be
which key risk component?
A. Frequency.
B. Hazard.
C. Peril.
D. Severity. - correct answer ✔✔B, a hazard
Why is risk management important to underwriters?
A. It reduces the potential for loss and assists in quantifying risks.
B. It is a fee-earning opportunity and encourages customer loyalty.
C. It is the best way to assess and quantify the sums insured at risk.
D. It is the only way for an insurer to gain an understanding of a policyholder's business. - correct answer
✔✔A, it reduces the potential for loss and assists in quantifying risks.
Which category of risk has the three possible outcomes of a loss, a break even or a gain?
A. A fundamental risk.
B. A particular risk.
C. A pure risk.
D. A speculative risk. - correct answer ✔✔D, a speculative risk.
In relation to general insurance, to be insured a risk must be:
,A. avoidable.
B. fortuitous.
C. inevitable.
D. unavoidable. - correct answer ✔✔B, fortuitous.
In terms of frequency and severity, the risk of an explosion aboard an oil rig is classed as:
A. high frequency, high severity.
B. high frequency, low severity.
C. low frequency, low severity.
D. low frequency, high severity. - correct answer ✔✔D, low frequency, high severity.
A hazard is defined as something which:
A. can adversely affect the risk to be insured.
B. does not affect the risk to be insured.
C. is always covered by an insurance policy.
D. is always excluded from an insurance policy. - correct answer ✔✔A, can adversely affect the risk to be
insured.
From an insurer's point of view, risk can be defined as the:
A. certainty of loss.
B. frequency of loss.
C. measure of loss.
D. possibility of loss. - correct answer ✔✔D, possibility of loss.
In relation to insurance, a peril is:
, A. an event which may give rise to a loss.
B. the chance of an event which may give rise to a loss.
C. an internal feature that increases the chance of an event which may give rise to a loss.
D. an external feature that increases the chance of an event which may give rise to a loss. - correct
answer ✔✔A, an event which may give rise to a loss.
What is the presence of flammable composite panels in the construction of a factory building best
described as?
A. A fundamental risk.
B. A hazard.
C. A peril.
D. A pure risk. - correct answer ✔✔B, a hazard.
In terms of frequency and severity, the accidental damage to the windscreen is typically classified as:
A. high frequency, low severity.
B. high frequency, high severity.
C. low frequency, low severity.
D. low frequency, high severity. - correct answer ✔✔A, high frequency, low severity.
A shop owner has installed security cameras and an alarm system, as well as internal and external locks
on all entrances. What type of risk management does this represent?
A. Risk analysis.
B. Risk control.
C. Risk elimination.
D. Risk transfer. - correct answer ✔✔B, risk control.
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