IC MOCK EXAM 1 & 2 LATEST 2023 GRADED A

IC MOCK EXAM 1 & 2 LATEST 2023 GRADED A - Answer<>Life insurance is c a. Only available to a specific group b. A speculative risk c. A cooperative risk-sharing plan d. Paid-up insurance (reduced insurance) d - Answer<>The fundamental advantage of the use of life insurance as a means of meeting economic losses is that through life insurance these losses are a. Reduced for the group as a whole through the multiplier effect b. Deferred for a specified period of time c. Met as they arise through savings accumulated on an assessment bases d. Spread over a large number of people *A basic principle of insurance is sharing the financial consequences of events that are unlikely to occur like death of a breadwinner. With life insurance, economic loss that may be experienced by one individual can be shared with other people thus the concept of risk sharing. d - Answer <>Insurance provides protection against economic loss by enabling the policy owner to a. Transfer responsibility for the loss to others b. Take speculative risk to compensate for the loss c. Reduce the possibility of the occurrence of the event causing the loss d. Share the loss with others exposed to a similar risk *This refers to the concept of risk-sharing whereby a group of people pool funds and resources together in preparation for life's many risks, notably death. It enables a group of people, with the similar circumstances, to spread the risk to a large number of people through cooperative risk-sharing. d - Answer <>A person's human economic value is defined as the a. Total value of the individual's tax contribution to the national economy b. Total value of his physical assets c. The amount of capital required to replace family income needs d. Total value of the assets and any future earnings derived there from *A person's human life value is a measure of what has been able to accumulate and what he can reasonably expect to earn in the future. d - Answ er<>"Critical years" in the programming of life insurance means