Insurance MCQ Daily-03

Q-1- Within a large global organisation, who has the primary responsibility of identifying individual risk owners and making sure appropriate risk control activities are carried out?

1. Risk Manager
2. Risk Committee
3. Chief Risk Manager
4. Board of Directors

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Q-2- In relation to a large organisation’s risk management process, what does the internal audit function typically have responsibility for?

1. Preparing designated parts of an up-to-date risk register
2. Setting detailed targets and objectives within the Board remit
3. Providing detailed assurance that risk management processes are effective
4. Helping to evaluate existing risk controls in specified areas of the business only

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Q-3- An organisation operates with separate and independent risk management,
compliance and audit functions. The organisation’s board of directors should be aware that

1. all costs will be reduced and more risks will be eliminated
2. this is likely to create a more robust approach to managing risk
3. work will often be duplicated and costs will usually be increased
4. holistic risk management processes will be more effective across the organization

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Q-4-A risk register has been produced for a large engineering company. What is a key difficulty of such a register?

1. It is impossible to update it on a regular basis.
2. It is likely to list only a very small number of risks.
3. It may fail to take account of correlations between risks.
4. Stakeholders must be consulted upon all risk management decisions.

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Q-5-What is a key consideration when designing an organisational risk register?

1. The organisation’s risk profile is captured.
2. All staff can update and accept new risks.
3. It is always installed on a web-based system.
4. All staff receive training on updating the register.

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Q-6- Why is it important that an organization attempts to measure the benefits of risk management in financial terms?

1. It will improve the delivery of services to customers.
2. It will ensure faster recovery from emergency incidents.
3. It will record all electronic interventions to provide an audit trail.
4. It will quantify the level of internal and external resources that are required.

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Q-7- When considering risk management within a manufacturing organisation, what is a key benefit of conducting a detailed structured analysis of the entire organisation?

1. It would identify all counterparty risks that affect financial stability.
2. It would identify alternative production methods and remove all risks.
3. It would allow the organisation to develop silo-based risk management techniques.
4. It would uncover weaknesses and provide valuable information that can be used to improve processes.

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Q-8- A key influence on the evolution of risk management theory in the 19th Century was based on

1. calculating the standard deviation of a distribution around a mean.
2. mathematicians collecting measurements to provide statistical data.
3. placing a greater emphasis on the human element of decision making.
4. economists analysing the relationship between unemployment and interest rates.

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Q-9- How did the large fluctuations in prices of many raw materials and commodities in the 1970’s influence the evolution of risk management?

1. An increase in the use of captive insurers.
2. Derivatives being used as a risk management tool.
3. The development of business continuity planning.
4. Financial institutions increasing their market and credit risk management services.

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Q-10- Insurance policies issued by a commercial insurer operating solely in the UK are directly governed under which Act?

1. Insurance Act 2015
2. Sarbanes-Oxley Act 2002
3. Financial Services Act 2012
4. Consumer Insurance (Disclosure and Representations) Act 2012

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