Ashford BUS323 Week 2 Quiz Latest

BUS323 Risk Management & Insurance

Week 2 Quiz

The transfer of insurable risk to the capital markets through the creation of a financial instrument is called

Which of the following statements about "all-risks" coverage is (are) true? I. All losses are covered except those losses specifically excluded.

II. The burden of proof is on the insured to prove that a loss is covered.

All of the following statements about subrogation are true EXCEPT

Which of the following statements about a warranty in an insurance contract is (are) true? I. It is part of the insurance contract.

II. Statements made by an insurance applicant are considered warranties rather than representations.

Mark owns a bar. The bar has a back room where Mark has some slot machines. Mark lets some of his patrons play the machines, and Mark keeps any profits. This type of gambling is illegal where Mark lives. Mark wanted to purchase insurance in case his slot machines were confiscated by the police. Such an insurance contract would not be enforceable. Which requirement needed to form a valid insurance contract is missing?

Which of the following is a financial derivative that derives value from specific insurable losses or from an index of values?

All of the following statements about endorsements and riders are true EXCEPT

Uncertainty pertaining to the organization's goals and objectives and the organization's strengths, weaknesses, opportunities, and threats is called

David owns a liquor store in a high-crime area. In order to obtain a reduced insurance premium, David promised to have a burglar alarm operating at the store when the store was closed. This agreement, which was incorporated into the insurance contract, is an example of a

Jacob sold his house to Shelia for $140,000 in cash. Jacob "threw in" insurance on the house as part of the deal and did not bother telling the insurer that there was a new owner. Four months after Shelia purchased the home, a windstorm damaged the roof. Which of the following legal characteristics of insurance contracts could the insurer use to legally deny payment for the damage to the roof?