Question 1

Who cedes business to a reinsurer?

Options :

A : The insurer.

B : The assessor.

C : The agent.

D : The insured.

Answer: A

Question 2

A policyholder achieves peace of mind when insuring his car by

Options :

A : eliminating the risk of loss.

B : reducing the chance of a loss occurring.

C : preventing the chance of a loss occurring.

D : transferring the risk to the insurer.

Answer: D

Question 3

If an insurer invokes the cancellation clause to cancel a policy mid-year due to a change in the risk, how much of the premium, if anything, is normally returned to the policyholder?

Options :

A : The full year-s premium less a fixed nominal charge.

B : The full year-s premium.

C : None of the premium.

D : A pro rata amount.

Answer: A

Question 4

Reinsurance is usually purchased by the

Options :

A : intermediary.

B : insurer.

C : regulator.

D : insured.

Answer: B

Question 5

If a surveyor is sent lo survey a risk, what does risk primarily refer to in this context?

Options :

A : The policyholder.

B : The premises.

C : The policy cover details.

D : The insured perils.

Answer: B

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