John Jenkins is the risk manager for Jumbo, Inc. Jumbo is a large retail store in a major metropolitan area jumbo stores are open from 9am to 9pm every day. From 9pm to 9 ar Cleaning and maintenance crews prepare the stores for the next day's retail activities. In addition, restocking of inventory is completed each night. John is concerned about to to the stores after hours. He is especially concerned about the manufacturing representatives who are restoring the shelves. These visitors are best described as Select one O a. Taitees Ob. Licensees OcTrespassers Od Sub-contractors Which of the following is NOT considered to be among the general methods for identifying loss oposures Select one: O Surveys, contract analysis, and flow charts Ob Physical inspections, financial documents, and risk management committees Oc Company documents questionnaires, and sales contracts Od Federal Acts, state statutes, and municipal Ordinances Mike Meticulous is a new risk manager and wants to be sure he identifies all of his organization's loss exposures. He knows that physical inspections are one of the seven ways to Identity exposures but he's unsure what benefit he'll get from wandering around the plant He thinks his time would be better spent by pouring over the firm's historie financial reports, and various contracts. Which of the following is NOT a mason Mike should include a personal physical inspection? 5 on Oa Select one He can verity the published information O . He can discover who is at fault for previous losses Oc Local managers can discuss their safety concerns od Mike will get on-the-spot feedback and suggestions nence upon which to forecast fute The risk quantification process compares loss exposures relative to two criteria: Select one: O a. Loss frequency, and loss severity O b. The cost of retention, and the cost of insurance Oc The cost of the exposure unit, and the cost of insurance O d. The loss frequency versus loss severity, and the cost of insurance Freddie Franks, Florida Fun-park's risk manager, is trying to decide the best way to finance the p frequency), Freddie believes the best risk financing for this property is. Select one: O a. Retention, because the cost of insurance may be quite high O b. Transfer, because the loss may be catastrophic Oc Retention, because the probability is a medium value on his risk map O d. Insurance, because he is concerned about legal liability The old saying in risk management: "Don't risk a lot for a little is best exemplified by which of the fo Select one: O a. The insurance policy deductible should be increased to the largest possible amount O b. Retention should always be used unless the loss severity is large Oc Transfers should always be used unless the loss frequency is low Od Retention should not be used if the loss severity potential is high Which of the following is NOT a suggested technique to arrive at the amount of risk to be retained? Select one: O a. Loss range analysis - G Which of the following is NOT a suggested technique to arrive at the amount of risk to be retained? Select one: O a. Loss range analysis O b. Circle of risk Oc Loss triangle O d. Projected expected losses 12 months 24 months 36 months 2003 50000 70000 75000 factors 1.40 107 2004 61000 71000 (a) factors (b) c 2005 63000 d) le factors (9) The value of the 24 month loss development factor for the 2005 period (the value in cell (0) is Select one: Oa 1.62 O b. 1.50 OC 1.74 O d. 247 An actuary may calculate the expected loss and provide the results with a 55 percent confidence level. This confidel Select one: O a. The actuary's confidence in the projected loss value O b. The actuary may require an additional 45 percent more data before providing a loss projection Oc The actuary will need an addition 25 percent swing to fully fund the losses Od. The premium will be only 55 percent of the actual expected loss value An intentional tort is when: Select one: O a. someone intends for a specific result to occur, and that result does occur. O b. someone commits harmful act that they have been planning for a long time. Oc. someone tries to harm another person on purpose. O d. a harmful act that causes a significant amount of damage or injury. The three general types of authority in an agency relationship are: Select one: O a. express, implied, and apparent. O b. per se, statutory, and open and obvious. Oc express, implied, and statutory, O d. business, legal, and voluntary. An insured purchases a small sailboat. After the purchase, the insured calls her agent and asks if the boa because the sailboat does not have a motor, it is covered under her homeowners policy. Several months watercraft. This causes her to incur liability for the damage to the other vessel. When she files a claim un exceeds a particular hull length that was specified in her policy (a limitation which the agent had not mer claim, what is the correct result according to the doctrine of estoppel? Select one: O a. The specifications of the policy control, so her daim will be denied b. The agent provided misinformation, and the insured relied on that information, so her claim shoul . The daim should be covered because the insured informed the owner of the other vessel that she Od. The claim should be covered if the applicable Coast Guard regulations require liability insurance or An insured purchases a small sailboat. After the purchase, the insured calls her agent and asks if because the sailboat does not have a motor, it is covered under her homeowners policy. Several watercraft. This causes her to incur liability for the damage to the other vessel. When she files a ch exceeds a particular hull length that was specified in her policy (a limitation which the agent had claim, what is the correct result according to the doctrine of estoppel? Select one: O a. The specifications of the policy control, so her claim will be denied. O b. The agent provided misinformation, and the insured relied on that information, so her clair Oc. The claim should be covered because the insured informed the owner of the other vesselt O d. The claim should be covered if the applicable Coast Guard regulations require liability insur Sam is a small business owner, and has a $3 million personal liability policy. This means that: Select one: O a. Sam's liability can never exceed $3 million. O b. Sam can borrow up to $3 million against the value of the policy. O c. Sam's business is worth $3 million. O d. Sam is covered for liability claims up to $3 million, but may be required to pay for any liability