,
, Page 2 of 12 RSK4803
Jan/Feb 2025
Question 1 42 marks
1.1 Risk financing is an important element of risk … (2)
a. management.
b. the management process.
c. the management framework.
d. the control process.
1.2 Holistic risk management … (2)
a. takes advantage of internal risk hedging opportunities.
b. delivers efficient and effective risk hedging.
c. covers the identified exposures and minimise the total cost of risk.
d. achieves organisation’s objectives efficiently.
1.3 Strategic risk management means … (2)
a. delivering a strategy that allows efficient risk hedging.
b. delivering a strategy that is risk free, which maximises the value add.
c. achieving the organisation’s objectives efficiently.
d. achieving the organisation’s objectives within the stipulate time frame.
1.4 The senior underwriter reviewed the submitted insurance quotation and showed
the trainee underwriter that the R160 cost, which applies to all the 2025 insurance
quotations, was not included. The amount of R160 should be the … cost factor.(2)
a. moral hazard
b. adverse selection
c. capital
d. administration
1.5 The primary objective of minimising the cost of risk is to … (2)
a. maintain the ratio of the total cost of risk.
b. signal to investors that the company considers risks in its business decisions.
c. maximise return on investment.
d. signal to regulators that controls ensure compliance with laws and regulations.
,
, Page 2 of 12 RSK4803
Jan/Feb 2025
Question 1 42 marks
1.1 Risk financing is an important element of risk … (2)
a. management.
b. the management process.
c. the management framework.
d. the control process.
1.2 Holistic risk management … (2)
a. takes advantage of internal risk hedging opportunities.
b. delivers efficient and effective risk hedging.
c. covers the identified exposures and minimise the total cost of risk.
d. achieves organisation’s objectives efficiently.
1.3 Strategic risk management means … (2)
a. delivering a strategy that allows efficient risk hedging.
b. delivering a strategy that is risk free, which maximises the value add.
c. achieving the organisation’s objectives efficiently.
d. achieving the organisation’s objectives within the stipulate time frame.
1.4 The senior underwriter reviewed the submitted insurance quotation and showed
the trainee underwriter that the R160 cost, which applies to all the 2025 insurance
quotations, was not included. The amount of R160 should be the … cost factor.(2)
a. moral hazard
b. adverse selection
c. capital
d. administration
1.5 The primary objective of minimising the cost of risk is to … (2)
a. maintain the ratio of the total cost of risk.
b. signal to investors that the company considers risks in its business decisions.
c. maximise return on investment.
d. signal to regulators that controls ensure compliance with laws and regulations.
,
