Risk Management Test Review UPDATED
ACTUAL Exam Questions and CORRECT
Answers
All of the above are elements of a negligent act.
______ is the death of an individual with outstanding financial obligations. - CORRECT
ANSWER - Premature death
True or false: A tort is a legal wrong for which the law allows a remedy in the form of money
damages - CORRECT ANSWER - True
Which of the following statements is(are) true?
I. A property owner cannot deliberately injure or set a trap for the trespasser.
II. A property owner does not have an obligation to warn an invitee of any dangerous conditions
that might cause harm - CORRECT ANSWER - I only
Awards for losses that can be determined and documented are - CORRECT ANSWER -
special damages
Which of the following statements regarding imputed negligence is(are) true?
I. The negligent act of an employee can never be imputed to the employer.
II. A business that sells liquor can be held liable for damages that may result from the sale of
liquor - CORRECT ANSWER - II only
A situation or circumstance in which a loss is possible, regardless of whether a loss occurs, is
called a - CORRECT ANSWER - loss exposure.
, Which of the following statements is(are) true?
I. A building is an example of a real property loss exposure.
II. An automobile is an example of a personal property loss exposure. - CORRECT
ANSWER - both I and II are correct
True or false: Windstorm is a common peril associated with property exposures. - CORRECT
ANSWER - True
All of the following are techniques that reduce the frequency and/or severity of losses (i.e. risk
control techniques) EXCEPT - CORRECT ANSWER - Commercial insurance
Which of the following statements is(are) true?
I. The local campus recreation center requires non-members to sign waivers of liability before
the non-members can exercise at the facility. From the perspective of the local campus recreation
center, this practice is an example of a non-insurance transfer of risk.
II. Typically, when a firm actively retains a given risk, the firm has less incentive to prevent
losses arising from the retained risk. - CORRECT ANSWER - I only
The worst loss that is likely to happen is referred to as the - CORRECT ANSWER -
maximum probable loss.
Loss frequency is defined as the - CORRECT ANSWER - probable number of losses that
may occur during some period.
Samantha is a risk manager at a large pet food corporation. Which of the following is NOT a
useful source of information for helping Samantha to identify the pure property loss exposures
associated with her company's manufacturing facility? - CORRECT ANSWER - Currency
exchange rates
ACTUAL Exam Questions and CORRECT
Answers
All of the above are elements of a negligent act.
______ is the death of an individual with outstanding financial obligations. - CORRECT
ANSWER - Premature death
True or false: A tort is a legal wrong for which the law allows a remedy in the form of money
damages - CORRECT ANSWER - True
Which of the following statements is(are) true?
I. A property owner cannot deliberately injure or set a trap for the trespasser.
II. A property owner does not have an obligation to warn an invitee of any dangerous conditions
that might cause harm - CORRECT ANSWER - I only
Awards for losses that can be determined and documented are - CORRECT ANSWER -
special damages
Which of the following statements regarding imputed negligence is(are) true?
I. The negligent act of an employee can never be imputed to the employer.
II. A business that sells liquor can be held liable for damages that may result from the sale of
liquor - CORRECT ANSWER - II only
A situation or circumstance in which a loss is possible, regardless of whether a loss occurs, is
called a - CORRECT ANSWER - loss exposure.
, Which of the following statements is(are) true?
I. A building is an example of a real property loss exposure.
II. An automobile is an example of a personal property loss exposure. - CORRECT
ANSWER - both I and II are correct
True or false: Windstorm is a common peril associated with property exposures. - CORRECT
ANSWER - True
All of the following are techniques that reduce the frequency and/or severity of losses (i.e. risk
control techniques) EXCEPT - CORRECT ANSWER - Commercial insurance
Which of the following statements is(are) true?
I. The local campus recreation center requires non-members to sign waivers of liability before
the non-members can exercise at the facility. From the perspective of the local campus recreation
center, this practice is an example of a non-insurance transfer of risk.
II. Typically, when a firm actively retains a given risk, the firm has less incentive to prevent
losses arising from the retained risk. - CORRECT ANSWER - I only
The worst loss that is likely to happen is referred to as the - CORRECT ANSWER -
maximum probable loss.
Loss frequency is defined as the - CORRECT ANSWER - probable number of losses that
may occur during some period.
Samantha is a risk manager at a large pet food corporation. Which of the following is NOT a
useful source of information for helping Samantha to identify the pure property loss exposures
associated with her company's manufacturing facility? - CORRECT ANSWER - Currency
exchange rates
