LH Chapter 1 FL Manual
Quiz by Brian Morton
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7 questions
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- Q1Which of the following insurance concepts is founded on the ability to predict the approximate number of deaths or frequency of disabilities within a certain group during a specific time?Quantum insurance principleIndemnity lawPrinciple of large lossLaw of large numbers60s
- Q2Which of the following statements is CORRECT?Both pure risks and speculative risks are insurableOnly pure risks are insurableOnly speculative risks are insurableNeither pure risks nor speculative risks are insurable60s
- Q3Which of the following statements does NOT describe an element of an insurable risk?The loss exposures to be insured must be largeThe loss cannot be catastrophicThe loss must be definite and measurableThe loss must not be due to chance60s
- Q4Buying insurance is one of the most effective ways ofTransferring riskReducing riskAvoiding riskRetaining risk60s
- Q5Which of the following best describes the function of insurance?It creates and protects risksIt spreads financial risk over a large group to minimize the loss to any one individualIt is a form of legalized gamblingIt protects against living too long60s