________ are set up primarily to insure the risks of their parent and related companies.
Insurers are using alternative distribution channels to market their insurance products. Which one of the following is NOT an alternative distribution channel?
Credit card providers
Marketing staff of the insurer.
A vehicle collision that causes a driver to suffer personal injury and physical damage to his vehicle is an example of a:
________ is NOT a speculative risk.
Running in a marathon
Betting on a horse race
Venturing into a food business
Investing in stocks and securities
________ are uninsurable.
The potential loss of an insurable risk must be:
indefinite in terms of time and amount
large enough to create a financial burden for the insured
certain to happen to a large number of insureds at the same time
The lightning that caused the factory owned by Adrian to be burnt down is referred to as the:
Betsy has a fear of drowning, so she chooses not to swim. This is an example of risk:
Strict enforcement of safety rules in construction sites is an example of loss:
As specified in Session 57(1)(b) of the Insurance Act (Cap. 142), insurable interest is NOT present when the:
husband purchases insurance on the life of his wife
creditor purchases insurance on the life of his debtor
grandmother purchases insurance on the life of her grandson
father purchases insurance on the life of his son below 18 years old
Which one of the following insurance policies does NOT require proof of insurable interest in the event of a claim?
Life Insurance policy
Marine Insurance policy
Liability Insurance policy
Property Insurance policy
Under the doctrine of utmost good faith, the parties to an insurance contract have the duty to disclose all:
commonly known facts
facts only when asked for
material facts relating to the risk being proposed
material assumptions relating to the loss reduction
In his proposal form for Fire Insurance, Donald states that his warehouse is installed with fire extinguishers when it is not. This is an example of ________ misrepresentation.
Under the principle of indemnity, there are a number of methods by which an insurer can provide the necessary indemnity to the insured in the event of a loss. Which one of the following is NOT a method of providing indemnity?
Policy renewal discount
The principle of indemnity applies to ________ Insurance policies.
Max Hardware Storage, a warehouse, caught fire recently. Its owner claimed a loss of S$80,000 (hardware stock) against its Fire Insurance policy that included an Average Clause. The loss adjuster appointed by the insurer was satisfied that the quantum of loss claimed was correct. However, the lost adjuster was of the opinion that there was at least S$160,000 in stock, but only S$120,000 was insured. As such, on application of average, the insurer's liability for loss under the policy amounts to
An explosion at his neighbour's factory caused a fire which spread to Calvin's factory and caused extensive damage. The insurer having paid the claim to Calvin under his Fire Insurance policy assumes his rights to recover the loss from his neighbour, who was responsible for the fire. This legal doctrine is known as:
The principle of contribution arises when there is a loss that involves two or more insurance policies covering:
the common interests
different subject matters
the same amount of sum insured
Which one of the following statements about a general insurance agent is NOT correct?
He procures new business for the insurer.
He services his existing business for the insurer.
He is also the principal party in an agency agreement.
He is essentially an intermediary acting for the insurer.
________ authority is the power that is granted to an agent by the principal in specific terms in the agency agreement.
The situation where the principal accepts its agent's actions that are made outside the scope of the agency agreement is known as:
Which of the following statements relating to the Law of Contract is CORRECT?
Undischarged bankrupts have the legal right to enter into contracts.
Mutual agreement of a contract can be evidenced by the making of an offer either orally or in writing.
A contract is enforceable by law without a consideration being passed from the promisee to the promisor.
All of the others.
Which one of the following insurance policies is an example of a "master contract" that is effected by a company to offer optional employee benefits?
Building and Contents
Group Personal Accident
Directors' and Officers' Liability
Which one of the following documents does NOT form part of an insurance contract?
Certificate of Insurance
In the proposal form for Fire Insurance, the information that has a material bearing on the potential hazards of the risk is the:
period of insurance cover
insurer's warning statement
insured's means of identification
Which one of the following statements BEST describes a cover note?
It can be used as a renewal notice.
It replaces the lost policy document.
It has the same legal status as the actual policy.
It forms the basis of risk assessment by the insurer.
A Certificate of Insurance is typically NOT required for ________ Insurance.
Private Motor Car
An implied condition is one that must be complied with, but does not appear in the policy document. Which one of the following is an example of an implied condition?
Subrogation of rights
Notification of claims
Existence of subject matter
Which one of the following question is NOT usually included in a check list used to perform a preliminary validation of a Property Insurance claim by an insurance company?
Is the claimant entitled to the payment?
Is the property covered under the policy?
Did the loss occur in a place covered by the policy?
Is the loss the indirect result of a hazard covered under the policy?
In the event of a loss or damage, the onus of proving that the loss has occurred rests solely with the:
A "Sue and Labour" clause enables the insured to recover expenses incurred in averting or minimising a loss under a policy. This clause is commonly found in a/an ________ Insurance policy.
Errors and Omissions
________ are independent intermediaries who can help policyholders to ensure that the eventual claim settlement recommended to the insurers is fair to both parties within the terms of the policy.
In Singapore, Section 24A of the Limitation Act (Cap. 163) provides for legal actions pertaining to damages for negligence, nuisance or breach of duty in respect of personal injuries to commence before the expiration of a certain limitation period from the date on which the course of action accrued. The limitation period in Singapore is ________ years.
The common method of settlement of the loss of a jewellery under a Theft Insurance policy is by:
________ is a risk transfer mechanism whereby the reinsurer transfers part of a risk to another reinsurer.
Which one of the following regarding treaty reinsurance is FALSE?
It may be placed on a proportional basis.
The reinsurers are obliged to accept all risks ceded.
Surplus Reinsurance is one example of treaty reinsurance.
It is more costly to administer as compared to facultative reinsurance.
A contract of reinsurance is strictly between the ________ and the reinsurer.
After retaining S$3,000,000 on a risk with an original sum insured of S$5,000,000, Gold Insurer reinsured the balance with Silver Reinsurer on a Proportional Facultative Reinsurance basis.
If there is a loss of S$2,000,000 on the risk, Silver Reinsurer will be liable to pay its share of loss amounting to:
The Monetary Authority of Singapore (MAS) Guideline No: FSG-G01 sets out fit and proper criteria applicable to all relevant persons in relation to the carrying out of any activity regulated by MAS. Examples of relevant persons are:
director of a registered insurer
broking staff of a registered insurance broker
substantial shareholder of a registered insurer
all of the others
Which of the following statements relating to the Singapore General Insurance Code of Practice ("The Code") is FALSE?
The objective of the Code is to ensure that the general insurance customer is treated fairly.
The Code covers how an insurance agent should maintain confidentiality of information relating to any of his customers.
The Code covers all types of general insurance products (including commercial lines) which are sold to corporate clients.