1. GEN 3A Sample Questions

2. Sample Multi-Choice Questions

3. Sample Question Risk probability is related most closely to which of the following? Risk probability is related most closely to which of the following? ASeverity of loss BFrequency of loss CA combination of frequency and severity of loss DTrends of loss history

4. Answer Risk probability is related most closely to which of the following? Risk probability is related most closely to which of the following? ASeverity of loss BFrequency of loss CA combination of frequency and severity of loss DTrends of loss history Answer: B

5. Sample Question Which of the following is an example of physical risk control? Which of the following is an example of physical risk control? A Transference of liability by contract A Transference of liability by contract BReduction of liability by outsourcing production BReduction of liability by outsourcing production CRetention of liability using a Captive insurer CRetention of liability using a Captive insurer DEvaluation of measurable hazards DEvaluation of measurable hazards

6. Answer Which of the following is an example of physical risk control? A Transference of liability by contract BReduction of liability by outsourcing production CRetention of liability using a Captive insurer DEvaluation of measurable hazards Answer: B

7. In the Irish motor insurance market, what (if any) is the standard basis used by insurers when pricing their insurance products so far as permitted driving is concerned? In the Irish motor insurance market, what (if any) is the standard basis used by insurers when pricing their insurance products so far as permitted driving is concerned? AThere is no standard practice BThe starting point is ‘owner-only driving’ with increases in premium for greater numbers driving CThe starting point is ‘named drivers’ with reductions in premium for ‘owner-only driving’ and increases for ‘any driver’ DThe starting point is ‘any driver’ with reductions in premium for more limited arrangements Sample Question

8. In the Irish motor insurance market, what (if any) is the standard basis used by insurers when pricing their insurance products so far as permitted driving is concerned? AThere is no standard practice BThe starting point is ‘owner-only driving’ with increases in premium for greater numbers driving CThe starting point is ‘named drivers’ with reductions in premium for ‘owner-only driving’ and increases for ‘any driver’ DThe starting point is ‘any driver’ with reductions in premium for more limited arrangements Answer: C Answer

9. Which of the following is an underlying risk improvement measure in relation to motor insurance? AReduction of policy cover BPremium loading CApplication of an excess DInstallation of an immobiliser and alarm Sample Question

10. Which of the following is an underlying risk improvement measure in relation to motor insurance? AReduction of policy cover BPremium loading CApplication of an excess DInstallation of an immobiliser and alarm Answer: D Answer

11. What is the purpose of an Irish Agrément Board Certificate? AIt certifies the fitness of new building products BIt certifies safety of a wide range of products in different industries CIt certifies firms to permit them to manufacture specific products DIt certifies an established safety record for products Sample Question

12. What is the purpose of an Irish Agrément Board Certificate? AIt certifies the fitness of new building products BIt certifies safety of a wide range of products in different industries CIt certifies firms to permit them to manufacture specific products DIt certifies an established safety record for products Answer: A Answer

13. Which of the following broad descriptions describes the motivation of most intermediaries in the insurance market? ASales-led BProduction-led CMarketing-led DCommission-led Sample Question

14. Which of the following broad descriptions describes the motivation of most intermediaries in the insurance market? Which of the following broad descriptions describes the motivation of most intermediaries in the insurance market? ASales-led BProduction-led CMarketing-led DCommission-led Answer: C Answer

15. The use of which of the following represents an indirect channel so far as an insurer is concerned? AInternet BTelemarketing CMedia DAuthorised advisor Sample Question

16. The use of which of the following represents an indirect channel so far as an insurer is concerned? The use of which of the following represents an indirect channel so far as an insurer is concerned? AInternet BTelemarketing CMedia DAuthorised advisor Answer: D Answer

17. Which of the following statements is true regarding a ‘reason why’ statement? Which of the following statements is true regarding a ‘reason why’ statement? AA ‘reason why’ statement must be prepared for every risk BA ‘reason why’ statement must be in a prescribed form CA ‘reason why’ statement must reflect the complexity of the product DA ‘reason why’ statement is only required for life, pensions and investment products Sample Question

18. Which of the following statements is true regarding a ‘reason why’ statement? AA ‘reason why’ statement must be prepared for every risk BA ‘reason why’ statement must be in a prescribed form CA ‘reason why’ statement must reflect the complexity of the product DA ‘reason why’ statement is only required for life, pensions and investment products Answer: C Answer

19. How is the ‘premises’ risk for a commercial public liability insurance usually arrived at? AIt is flat-rated BA rate is applied to wages CA rate is applied to turnover DA rate is applied to floor area Sample Question

20. How is the ‘premises’ risk for a commercial public liability insurance usually arrived at? AIt is flat-rated BA rate is applied to wages CA rate is applied to turnover DA rate is applied to floor area Answer: A Answer

21. If the Financial Services Ombudsman decides no formal investigation of a complaint is warranted, what happens next in the process? ABoth parties are advised and no appeal is permitted BBoth parties are advised and any appeal is reviewed by the deputy Ombudsman whose decision is final CBoth parties are advised and any appeal is reviewed by the deputy Ombudsman whose decision may be subject to further appeal procedures DBoth parties are advised and any appeal is reviewed by the deputy Ombudsman whose decision may only be appealed in a Court of law Sample Question

22. If the Financial Services Ombudsman decides no formal investigation of a complaint is warranted, what happens next in the process? ABoth parties are advised and no appeal is permitted BBoth parties are advised and any appeal is reviewed by the deputy Ombudsman whose decision is final CBoth parties are advised and any appeal is reviewed by the deputy Ombudsman whose decision may be subject to further appeal procedures DBoth parties are advised and any appeal is reviewed by the deputy Ombudsman whose decision may only be appealed in a Court of law Answer: C Answer

23. Sample Problem Question

24. XYZ is an insurer with a substantial commercial property portfolio. Senior management wish to review their underwriting approach for this class of business. Sample Problem Question

25. When XYZ consider how to develop an appropriate average rate which of the following is an external rather than an internal factor? AExpenses BInflation CReserve DProfit Sample Problem Question A

26. When XYZ assess their claims experience, to what does the term ‘Incurred But Not Enough Reported Claims’ refer? AClaims that must have taken place but of which the insurer is as yet unaware BA lack of recently reported claims CThe uncertainty of placing values on recently reported claims DThe general difficulty of accurate measurement of claims that remain outstanding Sample Problem Question B

27. If XYZ decide to allocate earned premiums on the basis of the proportion of the period of cover under each policy that relates to each accounting period, what is their underlying assumption? AThat there is an equal amount of risk in each accounting period BThat acquisition costs are unimportant CThat there will be sufficient premium to cover any future losses DThat risk exposure is proportionate to time Sample Problem Question C

28. Sample Problem Question D When calculating the average rate, what exposure measure is most likely to be used by XYZ? APolicies would be flat-rated B€100 Sum insured C€1,000 Turnover DPremium per property

29. Sample Problem Question E When XYZ consider their approach to individual risk assessment which of the following measures is most likely to be effective when there is a particular requirement essential for the acceptance of a risk ? AApplication of a warranty BA premium increase to reflect the greater likelihood of claims CCo-insurance on the part of the insured to encourage compliance with requirements DRestriction of policy cover either in size of sum nsured or scope of cover

30.  A – Answer: B  B – Answer: C  C – Answer: D  D – Answer: B  E – Answer: A Answers to Problem Question