Insurance

Discuss risk reduction through diversification.

Discuss risk reduction through diversification.

Discuss risk reduction through diversification.

keyone   72   1 Reply

giddu

Why is Enterprise Risk Management so important for firms?

Why is Enterprise Risk Management so important for firms?

Why is Enterprise Risk Management so important for firms?

medulla   109   1 Reply

giddu

Enterprise Risk Management is the response of the accounting profession to corporate fraud. T/F?

Enterprise Risk Management is the response of the accounting profession to corporate fraud. T/F?

Enterprise Risk Management is the response of the accounting profession to corporate fraud.
T/F?

medulla   112   1 Reply

jameel

The first step in the Risk Management Process is choosing appropriate risk handling techniques.T/F?

The first step in the Risk Management Process is choosing appropriate risk handling techniques.T/F?

The first step in the Risk Management Process is choosing appropriate risk handling techniques.
T/F?

medulla   121   1 Reply

giddu

Enterprise Risk Management is a comprehensive approach to corporate risk.T/F?

Enterprise Risk Management is a comprehensive approach to corporate risk.T/F?

Enterprise Risk Management is a comprehensive approach to corporate risk.
T/F?

medulla   124   1 Reply

jameel

Risk averse people have a tendency to shy away from insurance.T/F?

Risk averse people have a tendency to shy away from insurance.T/F?

Risk averse people have a tendency to shy away from insurance.
T/F?

medulla   114   1 Reply

national

A flood is an example of a non-diversifiable risk.T/F?

A flood is an example of a non-diversifiable risk.T/F?

A flood is an example of a non-diversifiable risk.
T/F?

keyone   106   1 Reply

giddu

Risk diversification is based on the principle that:

Risk diversification is based on the principle that:

Risk diversification is based on the principle that:
A) one should not be exposed to only one event
B) one should put all her "eggs in one basket"
C) risk can be measured subjectively
D) pure risk seldom happens

medulla   91   1 Reply

national

If you were the risk manager of the World Trade Center buildings, what loss prevention or reduction ...

If you were the risk manager of the World Trade Center buildings, what loss prevention or reduction ...

If you were the risk manager of the World Trade Center buildings, what loss prevention or reduction technique could you have implemented before the 9/11/01 tragedy that might have made a significant difference in the number of lives lost?
A) Gua

medulla   135   1 Reply

national

When faced with a risk of loss that is low frequency-high severity in nature, a prudent risk manager ...

When faced with a risk of loss that is low frequency-high severity in nature, a prudent risk manager ...

When faced with a risk of loss that is low frequency-high severity in nature, a prudent risk manager would choose which of the following methods for handling the loss exposure?
A) self-insure
B) avoidance
C) transfer
D) mediate

keyone   115   1 Reply

jameel

The Chief Risk Officer is concerned primarily with the management of:

The Chief Risk Officer is concerned primarily with the management of:

The Chief Risk Officer is concerned primarily with the management of:
A) operational risks
B) financial risks
C) strategic risks
D) all of the above

keyone   94   1 Reply

national

Which of the following would not normally be identified in the risk management process?

Which of the following would not normally be identified in the risk management process?

Which of the following would not normally be identified in the risk management process?
A) Property exposures
B) Speculative exposures
C) Indirect loss exposures
D) Operations exposures

medulla   97   1 Reply

jameel

Risk retention is not a good idea if:

Risk retention is not a good idea if:

Risk retention is not a good idea if:
A) the risk is unimportant
B) you did not identify the risk
C) the frequency is so low it almost will never happen
D) the exposure is potentially catastrophic

medulla   140   1 Reply

jameel

Loss prevention and control: (Multiple Choice)

Loss prevention and control: (Multiple Choice)

Loss prevention and control:
A) eliminate risk
B) are an alternative to self insurance
C) reduce the probability and severity of loss
D) directly minimize the probability of a natural disaster occurring

medulla   86   1 Reply

jameel

A "pure risk" is defined as a situation where there is the possibility:

A "pure risk" is defined as a situation where there is the possibility:

A "pure risk" is defined as a situation where there is the possibility:
A) of loss or no change
B) of profit or no change
C) of profit or loss
D) that actual losses will deviate from expected losses

medulla   112   1 Reply

giddu

The most difficult and important step in the risk management process generally is:

The most difficult and important step in the risk management process generally is:

The most difficult and important step in the risk management process generally is:
A) evaluating risk
B) reviewing the program
C) selecting the best method(s) to handle the risk
D) identifying the risk

keyone   117   1 Reply

jameel

In the context of ERM, hazard risk is defined as:

In the context of ERM, hazard risk is defined as:

In the context of ERM, hazard risk is defined as:
A) being associated with the strategic direction of a firm
B) being associated with the operations of a firm
C) adverse financial losses associated with diversifiable risks.
D) adv

keyone   94   1 Reply

giddu

The law of large numbers states that as the number of exposure units increases:

The law of large numbers states that as the number of exposure units increases:

The law of large numbers states that as the number of exposure units increases:
A) accuracy of predictions should improve
B) the chance of loss declines
C) Speculative risk increases
D) the number of accidents decreases

medulla   99   1 Reply

national

Examine the following list of "risks." Determine which of these are "pure ...

Examine the following list of "risks." Determine which of these are "pure ...

Examine the following list of "risks." Determine which of these are "pure risks."
I.   The risk that your antique Corvette will depreciate in market value
II.   The risk that you will have a collision in your Corvette, thus

medulla   101   1 Reply

jameel

Why is a large number of exposure units generally required for a risk to be insurable?

Why is a large number of exposure units generally required for a risk to be insurable?

Why is a large number of exposure units generally required for a risk to be insurable?
A) It prevents the insurer from losing money.
B) It guarantees that losses will be unintentional and measurable.
C) It enables the insurer to better

medulla   93   1 Reply

giddu

Why is a large number of exposure units generally required for a risk to be insurable?

Why is a large number of exposure units generally required for a risk to be insurable?

Why is a large number of exposure units generally required for a risk to be insurable?
A) It allows the insurer to accurately predict the aggregate dollar amount of loss.
B) It allows for at least some losses to occur.
C) It reduces sp

medulla   92   1 Reply

jameel

Diversifiable risk is defined as:

Diversifiable risk is defined as:

Diversifiable risk is defined as:
A) risk with two possible outcomes
B) risk with three possible outcomes
C) an individual's perception of risk
D) none of the above

medulla   140   1 Reply

jameel

Which of the following potential losses is not an example of a pure risk?

Which of the following potential losses is not an example of a pure risk?

Which of the following potential losses is not an example of a pure risk?
A) Loss of a home by fire
B) Theft of a car
C) Loss of $10,000 in the stock market
D) Theft of your wallet containing $100

keyone   90   1 Reply

jameel

Which of the following is not a risk handling technique?

Which of the following is not a risk handling technique?

Which of the following is not a risk handling technique?
A) Loss control
B) Loss diversification
C) Loss transfer
D) Loss financing

medulla   92   1 Reply

national

Which of the following is a true statement?

Which of the following is a true statement?

Which of the following is a true statement?
A) Liability risks are risks associated with building calamities.
B) Theft is a diversifiable risk.
C) Most individuals in the industrialized countries carry no insurance.
D) The Law of

medulla   129   1 Reply

giddu

Which of the following is not a type of risk when identifying a pure risk?

Which of the following is not a type of risk when identifying a pure risk?

Which of the following is not a type of risk when identifying a pure risk?
A) Retention Risk
B) Property Risk
C) Liability Risk
D) Human Resource Risk

medulla   172   1 Reply

giddu

The correct order of the steps in the Risk Management Process is:

The correct order of the steps in the Risk Management Process is:

The correct order of the steps in the Risk Management Process is:
A) Establish Goals, Identify Potential Loss Exposure, Measure Potential Loss Exposure, Choose Risk Handling Techniques, Implement Techniques and Monitor Effectiveness
B) Esta

medulla   193   1 Reply

giddu

Which of the following is a false statement?

Which of the following is a false statement?

Which of the following is a false statement?
A) Risk averse people will pay an insurance premium that is greater than the mathematically fair chance of loss in order to relieve themselves of uncertainty.
B) A risk seeker is willing to assum

medulla   130   1 Reply

giddu

Risk Pooling is an example of:

Risk Pooling is an example of:

Risk Pooling is an example of:
A) a Catastrophic Loss Event
B) diversifying risk
C) a speculate risk
D) applying the risk-return trade-off

medulla   132   1 Reply

national

Defective electrical wiring that may lead to a fire is an example of a:

Defective electrical wiring that may lead to a fire is an example of a:

Defective electrical wiring that may lead to a fire is an example of a:
A) pure risk
B) non-diversifiable risk
C) speculative risk
D) physical hazard

medulla   109   1 Reply

jameel

Which of the following is not a method of protection of risk?

Which of the following is not a method of protection of risk?

Which of the following is not a method of protection of risk?
A) Group insurance plans
B) Employee benefits
C) Social insurance
D) Humanitarian aid

medulla   162   1 Reply

giddu