ThatQuiz Test Library Take this test now
Risk management and insurance
Contributed by: Stokes
  • 1. Risk management involves identifying, assessing, and prioritizing potential risks in order to minimize their impact on an organization. Insurance is a common tool used in risk management, transferring the financial consequences of certain risks to an insurance company in exchange for a premium. By combining risk management practices with appropriate insurance coverage, organizations can protect themselves from unforeseen events that could otherwise have a significant financial impact. Effective risk management and insurance strategies are vital for ensuring the long-term success and sustainability of businesses in today's dynamic and unpredictable environment.

    What is risk management?
A) Buying insurance policies.
B) Process of identifying, assessing, and prioritizing risks.
C) Guessing the likelihood of risks.
D) Ignoring potential risks.
  • 2. What is insurance?
A) A contract that transfers the risk of financial loss from an individual or business to an insurance company.
B) A bank loan for emergencies.
C) A warranty for all purchases.
D) A government program for free healthcare.
  • 3. What is a deductible in insurance?
A) The total coverage amount in case of a claim.
B) The amount of money the policyholder is responsible for paying before the insurance company begins to cover costs.
C) The percentage of claim covered by the insurance company.
D) The premium paid for the insurance policy.
  • 4. Which type of insurance covers damage to your own vehicle in an accident?
A) Health insurance.
B) Home insurance.
C) Collision insurance.
D) Life insurance.
  • 5. What does liability insurance cover?
A) Identity theft protection.
B) Repair costs for your own car.
C) Medical expenses for you and your family.
D) Legal responsibility for bodily injury or property damage to others.
  • 6. In risk management, what is mitigation?
A) Ignoring the risk.
B) Transferring all risks to the insurance company.
C) Increasing the risk for higher profits.
D) Taking actions to reduce the probability or impact of a risk.
  • 7. Which risk management technique involves avoiding the risk altogether?
A) Risk sharing.
B) Risk transfer.
C) Risk avoidance.
D) Risk retention.
  • 8. How is risk typically measured in insurance?
A) Based on the policyholder's occupation.
B) By guessing the likelihood of events.
C) Through actuarial analysis and statistical models.
D) Using intuitive feelings.
  • 9. What is an indemnity in insurance?
A) Helpdesk support for policyholders.
B) Coverage for future potential losses.
C) Compensation for a loss or damage sustained.
D) Free insurance policies for a year.
  • 10. What does a claims adjuster do in the insurance industry?
A) Creates new insurance policies.
B) Markets insurance products.
C) Decides on insurance premiums.
D) Investigates, evaluates, and settles insurance claims.
  • 11. Which type of insurance covers potential legal expenses?
A) Life insurance.
B) Health insurance.
C) Liability insurance.
D) Travel insurance.
  • 12. What is reinsurance in the insurance industry?
A) When an insurance company serves multiple countries.
B) A type of insurance for retired individuals.
C) When an insurance company transfers some of its own risks to another insurer.
D) When insurance policies are canceled.
  • 13. What is 'premium' in insurance?
A) The amount paid by the policyholder to the insurance company for coverage.
B) The agreement between the insurance company and policyholder.
C) The coverage limit for each claim in the insurance policy.
D) The list of covered perils in the insurance policy.
Created with That Quiz — where test making and test taking are made easy for math and other subject areas.