Exam 23: Managing Risk

Concern about the employees is considered in which principle of a sound insurance program?

Match the term with its definition.Some terms may not be used. a.Actual cash value b.Aggregate stop loss limit c.Direct loss d.Disability buyout insurance e.Disability insurance f.Indirect loss g.Loss avoidance h.Loss prevention i.Loss reduction j.Replacement value of property k.Specific stop loss limit -An insurance term that refers to the depreciated value of property

Property insurance that covers all direct damage to property except damage caused by perils specifically excluded is called CGL.

Business risks can be classified into two broad categories-asset risk and pure risk.

Match the term with its definition.Some terms may not be used. a.All-risk approach b.Business risk c.Compensatory damages d.Disability insurance e.Economic damages f.Health maintenance organization g.Market risk h.Named-peril approach i.Peril j.Preferred provider organization k.Pure risk -Economic or non-economic damages intended to make the claimant whole by compensating the claimant for any injuries or loss arising from the negligent action

Pain,suffering,mental anguish and loss of physical abilities are included in which type of damages in a tort case?

A delivery truck owned by Martin's Lumber backed into a car owned by Bonnie.Bonnie asked Martin's Lumber to pay for the repairs to her car.Bonnie is asking for:

Match the term with its definition.Some terms may not be used. a.Business interruption insurance b.Business owner's policy c.Commercial general liability insurance d.Disability insurance e.Funds transfer fraud f.Key-person life insurance g.Package policy h.Personnel risks i.Proximate cause j.Reasonable standard k.Workers' compensation insurance -A negligent act that is the clear cause of damages sustained

Partially self-funded insurance programs that limit the self-insured portion of an employee's medical coverage to a specific amount is commonly referred to as an aggregate stop loss limit.

Flood insurance can be purchased for only real property.

Business interruption insurance covers

Match the term with its definition.Some terms may not be used. a.Automobile insurance b.Coinsurance clause c.Crime insurance d.Design defect e.Manufacturing defect f.Marketing defect g.Noneconomic damages h.Partially self-funded program i.Proximate cause j.Punitive damages k.Workers' compensation legislation -Compensatory damages for such losses as pain and suffering,mental anguish,and loss of physical abilities

Match the term with its definition.Some terms may not be used. a.All-risk approach b.Business risk c.Compensatory damages d.Disability insurance e.Economic damages f.Health maintenance organization g.Market risk h.Named-peril approach i.Peril j.Preferred provider organization k.Pure risk -A cause of loss,either through natural events or through the actions of people

Discuss the differences between pure risk,business risk and market risk.

To evaluate an insurance program,which question should be answered first?

Crime insurance is most critical for a small business when

Patrick has a great idea for a new business venture.Even after conducting research he is not certain whether he can make a go of it.Patrick is concerned about:

Requiring all servers in a restaurant to know how to properly lift heavy objects is an example of loss

Match the term with its definition.Some terms may not be used. a.Automobile insurance b.Coinsurance clause c.Crime insurance d.Design defect e.Manufacturing defect f.Marketing defect g.Noneconomic damages h.Partially self-funded program i.Proximate cause j.Punitive damages k.Workers' compensation legislation -A program that designates part of a firm's earnings to fund a portion of employee medical coverage

Match the term with its definition.Some terms may not be used. a.Actual cash value b.Aggregate stop loss limit c.Direct loss d.Disability buyout insurance e.Disability insurance f.Indirect loss g.Loss avoidance h.Loss prevention i.Loss reduction j.Replacement value of property k.Specific stop loss limit -A firm's per-employee limit on self-funding for medical claims