CEBS GBA UPDATED EXAM QUESTIONS
AND CORRECT ANSWERS
●● Broad View
Answer: "Virtually any form of compensation other than direct wages"
●● Limited (Narrow) View
Answer: Benefits that stem from an employment relationship, not
underwritten or paid for directly by the government
●● Reasons for growth in Employee Benefit Plans
Answer: Business, tax legislation, collective bargaining, efficiency of
the approach
●● Labor Management Relations Act (Taft Hartley Act)
Answer: Administered by the NLRB, requires good faith bargaining
between employers and employees in the matters of hours, wages, and
working conditions.
●● Effect of the Industrial Revolution
Answer: Employees started moving to employers in Cities, the grouping
of employees made it easier to cover all employees under one contract.
Employer benefits are convenient and simple.
,●● Effect of World War II
Answer: Wages were limited due to the government, employee benefits
were deemed as compensation.
●● Group Technique
Answer: Only certain groups are eligible (a specific company's
employees), steady flow of lives (cost increases as age increases),
minimum number of lives.
●● Functional Approach
Answer: Organized system for analyzing audience, participants exposure
to risk, focused on employee needs, reducing company loss, and being
thoughtful of cost parameters, originated in 1967 by George C. Foust.
●● Risk
Answer: Uncertainty when thinking in terms of a 'loss' (Loss referring to
the insurance of a decrease in value). Eg. Illness, death, disability,
unemployment, cost of medical bills .
●● Peril
Answer: The cause of personal/property loss, destruction, or damage.
●● Hazard
, Answer: A condition that increases the probability of a peril occurring or
that can increase the loss in the event of a peril.
●● Physical Hazard
Answer: The presence of flammable materials in absence of
extinguishers, machines without safety mechanisms, faulty heating/air
conditioner units.
●● Moral Hazard
Answer: Dishonest, unethical, and immoral people - those who
steal/damage company property; file fraudulent medical claims, abuse
sick time, falsify pay records or expenses
●● Morale Hazard
Answer: Those that arise through a person acting careless. It can also
include the act of not securing items of value; failing to notify
employees of hazards, etc.
●● Pure Risk
Answer: Either risk will happen, or will not happen. These types of risks
can be insured. Eg. sickness, accident, unemployment, disability, theft of
property, etc.
●● Speculative Risk
AND CORRECT ANSWERS
●● Broad View
Answer: "Virtually any form of compensation other than direct wages"
●● Limited (Narrow) View
Answer: Benefits that stem from an employment relationship, not
underwritten or paid for directly by the government
●● Reasons for growth in Employee Benefit Plans
Answer: Business, tax legislation, collective bargaining, efficiency of
the approach
●● Labor Management Relations Act (Taft Hartley Act)
Answer: Administered by the NLRB, requires good faith bargaining
between employers and employees in the matters of hours, wages, and
working conditions.
●● Effect of the Industrial Revolution
Answer: Employees started moving to employers in Cities, the grouping
of employees made it easier to cover all employees under one contract.
Employer benefits are convenient and simple.
,●● Effect of World War II
Answer: Wages were limited due to the government, employee benefits
were deemed as compensation.
●● Group Technique
Answer: Only certain groups are eligible (a specific company's
employees), steady flow of lives (cost increases as age increases),
minimum number of lives.
●● Functional Approach
Answer: Organized system for analyzing audience, participants exposure
to risk, focused on employee needs, reducing company loss, and being
thoughtful of cost parameters, originated in 1967 by George C. Foust.
●● Risk
Answer: Uncertainty when thinking in terms of a 'loss' (Loss referring to
the insurance of a decrease in value). Eg. Illness, death, disability,
unemployment, cost of medical bills .
●● Peril
Answer: The cause of personal/property loss, destruction, or damage.
●● Hazard
, Answer: A condition that increases the probability of a peril occurring or
that can increase the loss in the event of a peril.
●● Physical Hazard
Answer: The presence of flammable materials in absence of
extinguishers, machines without safety mechanisms, faulty heating/air
conditioner units.
●● Moral Hazard
Answer: Dishonest, unethical, and immoral people - those who
steal/damage company property; file fraudulent medical claims, abuse
sick time, falsify pay records or expenses
●● Morale Hazard
Answer: Those that arise through a person acting careless. It can also
include the act of not securing items of value; failing to notify
employees of hazards, etc.
●● Pure Risk
Answer: Either risk will happen, or will not happen. These types of risks
can be insured. Eg. sickness, accident, unemployment, disability, theft of
property, etc.
●● Speculative Risk
