Property and Casualty Insurance - quiz 20 - Amrit Karki
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Question 1 of 10
1. Question
Under a no-fault system of auto insurance
Correct
The benefits that would normally be paid by an at-fault party’s liability insurance become payable under the insured’s
Incorrect
The benefits that would normally be paid by an at-fault party’s liability insurance become payable under the insured’s
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Question 2 of 10
2. Question
The injured party has to prove that the driver of the other car was not at fault for the accident
Correct
Only the payment of damages is subject to the policy limits.
Incorrect
Only the payment of damages is subject to the policy limits.
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Question 3 of 10
3. Question
A reinsurer normally has a greater experience with such things as pricing higher limits policies and?
Correct
Technical expertise is a must with that responsibility.
Incorrect
Technical expertise is a must with that responsibility.
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Question 4 of 10
4. Question
Why is it important for an insurance company to encourage loss control?
Correct
Encouraging loss control not only allows the insurer to offer lower rates, but also provides an important service to society by reducing accidents.
Incorrect
Encouraging loss control not only allows the insurer to offer lower rates, but also provides an important service to society by reducing accidents.
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Question 5 of 10
5. Question
In contrast to manual rating plans, individual risk rating plans are plans in which?
Correct
This is the approach used in rating for many commercial lines of business
Incorrect
This is the approach used in rating for many commercial lines of business
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Question 6 of 10
6. Question
In the context of risk, setting a policy limit provides?
Correct
This, in turn, decreases the probability of insurer insolvency
Incorrect
This, in turn, decreases the probability of insurer insolvency
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Question 7 of 10
7. Question
A disappearing deductible in fixed-dollar deductibles is referred to as?
Correct
If the loss exceeds 1$ dollars, then the insurer pays the loss in full.
Incorrect
If the loss exceeds 1$ dollars, then the insurer pays the loss in full.
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Question 8 of 10
8. Question
The actuary, pursuing the rate-making objective of responsiveness should use?
Correct
Unfortunately, much of the latest data used will be incomplete or immature in the sense that the final claim cost will not be known and a claim cost estimate must be used.
Incorrect
Unfortunately, much of the latest data used will be incomplete or immature in the sense that the final claim cost will not be known and a claim cost estimate must be used.
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Question 9 of 10
9. Question
The loss elimination NIUJ (LER) is defined to be?
Correct
LER is the difference between the expected losses at the base level deductible and the expected losses at the deductible, divided by the expected losses at the base level deductible.
Incorrect
LER is the difference between the expected losses at the base level deductible and the expected losses at the deductible, divided by the expected losses at the base level deductible.
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Question 10 of 10
10. Question
Having policy limits allows the policyholder to choose
Correct
The premium will be lower for lower policy limits.
Incorrect
The premium will be lower for lower policy limits.