Question 1

Which of the following statements is true with regard to the regulation of money market corporations?

Accepted Answer

A)  Money market corporations are unregulated. 
B)  APRA is the primary regulator for money market corporations. 
C)  ASIC is the primary regulator for money market corporations. 
D)  The ACCC is the primary regulator for money market corporations. 
A)  Money market corporations are unregulated. 
B)  APRA is the primary regulator for money market corporations. 
C)  ASIC is the primary regulator for money market corporations. 
D)  The ACCC is the primary regulator for money market corporations.

Question 2

Which of the following statements is true in relation to the balance sheet and balance sheet trends of general insurance companies?

Accepted Answer

A)  They tend to have a high proportion of investments in equity assets. 
B)  They tend to have a low proportion of investments in bonds. 
C)  There has been little change in the structure of assets between 2002 and 2011, except for a decline in equity investments. 
D)  All of the listed options are correct. 
A)  They tend to have a high proportion of investments in equity assets. 
B)  They tend to have a low proportion of investments in bonds. 
C)  There has been little change in the structure of assets between 2002 and 2011, except for a decline in equity investments. 
D)  All of the listed options are correct.

Question 3

An individual's life insurance policy usually covers the policyholder plus the policyholder's spouse and family.

Accepted Answer

A) True 
 B)False

Question 4

Which of the following are typical products offered by general insurance companies?

Accepted Answer

A)  superannuation funds 
B)  life insurance policies 
C)  professional indemnity insurance 
D)  superannuation funds and professional indemnity insurance 
A)  superannuation funds 
B)  life insurance policies 
C)  professional indemnity insurance 
D)  superannuation funds and professional indemnity insurance

Question 5

Which of the following statements is true?

Accepted Answer

A)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders make periodic premium payments. 
B)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders make a lump sum payment at maturity of the policy. 
C)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders receive periodic premium payments. 
D)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders receive a lump sum payment at maturity of the policy. 
A)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders make periodic premium payments. 
B)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders make a lump sum payment at maturity of the policy. 
C)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders receive periodic premium payments. 
D)  Ordinary life insurance involves policies marketed on an individual basis, on which policyholders receive a lump sum payment at maturity of the policy.

Question 6

Which of the following statements is true in the context of SOARS?

Accepted Answer

A)  Oversight entities are subject to routine information gathering from statistical returns and onsite visits. 
B)  Mandated improvement entities are not at material risk of failure. 
C)  Normal entities lie outside APRA's tolerable risk range, but are unlikely to fail. 
D)  Restructure entities have lost APRA's confidence. 
A)  Oversight entities are subject to routine information gathering from statistical returns and onsite visits. 
B)  Mandated improvement entities are not at material risk of failure. 
C)  Normal entities lie outside APRA's tolerable risk range, but are unlikely to fail. 
D)  Restructure entities have lost APRA's confidence.

Question 7

Outline the role that securitisation vehicles play in the Australian financial system and explain how the global financial crisis (GFC) impacted this form of financing. What actions did the Australian government take as a response to such an impact?

Accepted Answer

Securitisation vehicles have had an impo

Question 8

What is a common rationale for a managed fund?

Accepted Answer

A)  the need for more diversity in investment products 
B)  the opportunity for retail investors to achieve superior diversification 
C)  the potential for retail investors to achieve superior returns 
D)  the opportunity for retail investors to achieve superior diversification and the potential for retail investors to achieve superior returns 
A)  the need for more diversity in investment products 
B)  the opportunity for retail investors to achieve superior diversification 
C)  the potential for retail investors to achieve superior returns 
D)  the opportunity for retail investors to achieve superior diversification and the potential for retail investors to achieve superior returns

Question 9

Pure insurance companies are exposed to a single risk only, this being insurance risk.

Accepted Answer

A) True 
 B)False

Question 10

While insurance companies are exposed to credit, operational and investment risk, there is no direct regulation for these risks set out by APRA.

Accepted Answer

A) True 
 B)False

Question 11

Which of the following statements is true?

Accepted Answer

A)  Unbundled life insurance is also called investment-free insurance. 
B)  Bundled life insurance is also called investment-free insurance. 
C)  Unbundled life insurance is also called investment-linked insurance. 
D)  Bundled life insurance is also called investment-linked insurance. 
A)  Unbundled life insurance is also called investment-free insurance. 
B)  Bundled life insurance is also called investment-free insurance. 
C)  Unbundled life insurance is also called investment-linked insurance. 
D)  Bundled life insurance is also called investment-linked insurance.

Question 12

Discuss the development of the general insurance industry over the period 1980 to 2012 and briefly explain the major risks of underwriting general insurance.

Accepted Answer

In March 2012, there were a total of 124

Question 13

Insurance policy benefits are classified on an insurance company's balance sheet as:

Accepted Answer

A)  liabilities, because the insurance company may have to pay out the benefits. 
B)  assets, because policy benefits are valuable to the company. 
C)  liabilities, because customers may fall behind on their premium payments. 
D)  assets, because policy benefits are fully covered by premium payments. 
A)  liabilities, because the insurance company may have to pay out the benefits. 
B)  assets, because policy benefits are valuable to the company. 
C)  liabilities, because customers may fall behind on their premium payments. 
D)  assets, because policy benefits are fully covered by premium payments.

Question 14

Insurance risk refers to the risk that:

Accepted Answer

A)  a lot of policyholders make claims. 
B)  the insurance market is saturated and thus the insurance companies cannot write additional policies. 
C)  individuals and companies are over-insured leading to high liability values in insurance companies. 
D)  actual policy liabilities turn out to be higher than provisions or reserves for policy liabilities. 
A)  a lot of policyholders make claims. 
B)  the insurance market is saturated and thus the insurance companies cannot write additional policies. 
C)  individuals and companies are over-insured leading to high liability values in insurance companies. 
D)  actual policy liabilities turn out to be higher than provisions or reserves for policy liabilities.

Question 15

Which of the following statements is true?

Accepted Answer

A)  A term insurance policy has no savings element attached to it. 
B)  The maximum term of a term life insurance is 20 years. 
C)  The minimum term of a term life insurance is 5 years. 
D)  A term insurance policy has no savings element attached to it and the maximum term of a term life insurance is 20 years. 
A)  A term insurance policy has no savings element attached to it. 
B)  The maximum term of a term life insurance is 20 years. 
C)  The minimum term of a term life insurance is 5 years. 
D)  A term insurance policy has no savings element attached to it and the maximum term of a term life insurance is 20 years.

Question 16

Property-casualty insurers tend to have a higher level of liquidity risk than life insurers.

Accepted Answer

A) True 
 B)False

Which of the following statements is true with regard to the regulation of money market corporations?

Which of the following statements is true in relation to the balance sheet and balance sheet trends of general insurance companies?

An individual's life insurance policy usually covers the policyholder plus the policyholder's spouse and family.

Which of the following are typical products offered by general insurance companies?

Which of the following statements is true?

Which of the following statements is true in the context of SOARS?

Outline the role that securitisation vehicles play in the Australian financial system and explain how the global financial crisis (GFC) impacted this form of financing. What actions did the Australian government take as a response to such an impact?

What is a common rationale for a managed fund?

Pure insurance companies are exposed to a single risk only, this being insurance risk.

While insurance companies are exposed to credit, operational and investment risk, there is no direct regulation for these risks set out by APRA.

Which of the following statements is true?

Discuss the development of the general insurance industry over the period 1980 to 2012 and briefly explain the major risks of underwriting general insurance.

Insurance policy benefits are classified on an insurance company's balance sheet as:

Insurance risk refers to the risk that:

Which of the following statements is true?

Property-casualty insurers tend to have a higher level of liquidity risk than life insurers.

Why Are Financial Institutions Special

The Financial Services Industry: Depository Institutions

Risk of Financial Institutions

Interest Rate Risk Measurement: The Repricing Model

Interest Rate Risk Measurement: the Duration Model

Managing Interest Rate Risk Using Off Balance Sheet Instruments

Credit Risk I: Individual Loan Risk

Market Risk

Credit Risk I: Individual Loan Risk

Credit Risk II: Loan Portfolio and Concentration Risk

Sovereign Risk

Foreign Exchange Risk

Liquidity Risk

Liability and Liquidity Management

Off-Balance-Sheet Activities

Technology and Other Operational Risk

Capital Management and Adequacy

Filters

Exam 3: The Financial Services Industry: Other Financial Institutions

Which of the following statements is true with regard to the regulation of money market corporations?

Which of the following statements is true in relation to the balance sheet and balance sheet trends of general insurance companies?

An individual's life insurance policy usually covers the policyholder plus the policyholder's spouse and family.

Which of the following are typical products offered by general insurance companies?

Which of the following statements is true?

Which of the following statements is true in the context of SOARS?

Outline the role that securitisation vehicles play in the Australian financial system and explain how the global financial crisis (GFC) impacted this form of financing. What actions did the Australian government take as a response to such an impact?

What is a common rationale for a managed fund?

Pure insurance companies are exposed to a single risk only, this being insurance risk.

While insurance companies are exposed to credit, operational and investment risk, there is no direct regulation for these risks set out by APRA.

Which of the following statements is true?

Discuss the development of the general insurance industry over the period 1980 to 2012 and briefly explain the major risks of underwriting general insurance.

Insurance policy benefits are classified on an insurance company's balance sheet as:

Insurance risk refers to the risk that:

Which of the following statements is true?

Property-casualty insurers tend to have a higher level of liquidity risk than life insurers.

Why Are Financial Institutions Special

The Financial Services Industry: Depository Institutions

Risk of Financial Institutions

Interest Rate Risk Measurement: The Repricing Model

Interest Rate Risk Measurement: the Duration Model

Managing Interest Rate Risk Using Off Balance Sheet Instruments

Credit Risk I: Individual Loan Risk

Market Risk

Credit Risk I: Individual Loan Risk

Credit Risk II: Loan Portfolio and Concentration Risk

Sovereign Risk

Foreign Exchange Risk

Liquidity Risk

Liability and Liquidity Management

Off-Balance-Sheet Activities

Technology and Other Operational Risk

Capital Management and Adequacy

Filters