Principles of Insurance (FINA 3385.01)
Quiz #1 Review
Exam: February 11, 2008
Chapter 1 – Risk in our Society
Examples of perils and physical hazards
Major types of examples pure risk that create financial insecurity (personal, property,
liability risks)
5 methods of handling risk
Risk management technique appropriate for different risk exposures
Application Questions: 1, 2, 3, 4
Case Application
Chapter 2 – Insurance and Risk
4 basic characteristics of insurance - why each is important
6 Requirements of insurable risk – why each is important
Type of insurance for different exposures
Discuss the benefits/costs of insurance to society
Application Question: 4
Case Application
Chapter 5 – Types of Insurers and Marketing Systems
Discuss the 2 primary ways that people wanting to buy insurance are linked with
insurance companies. What is the primary difference between the two?
Application Question: 5
Chapter 6 – Insurance Company Operations
What are the elements that insurance companies consider when determining the price of
insurance products?
How does the underwriting function of an insurance company impact pricing?
How does the claims settlement function of an insurance company impact pricing?
How does reinsurance impact pricing?
Application Questions: 1, 2, 5
