Insurance & Risk Management BBA Second year Fourth Semester examination 2010

BBA second year fourth semester examination, 2010

INSURANCE & RISK MANAGEMENT

Subject code: 2201

Examination code: 604

Time – 3 hours

Full marks- 70

[N.B. - the figures in the right margin indicate full marks. Answer any five questions from Part A and three questions from part B]

Part – A  - Short Question

Marks- 5x5=25

1. (a) Life insurance encourage savings- explain

   (b) “Insurance is a system of spreading the loss of one into the shoulder of many” –     interpret the statement using suitable example.

2. Define re-insurance. Review the legal consideration of re-insurance contract.

3. Discuss the procedures of settlement of life insurance claims.

4. (a) “Husband has insurable interest in the life of his wife” –discuss.

   (b) The police are freely assignable in case of life insurance – discuss.

5. (a) What is reserve? How and for what is it created?

   (b)Discuss the methods of calculating surrender value.

6. What do you mean by warranties? What are the important warranties in marine      insurance?

7. (a)  What are the uses of fire insurance?

   (b)What are the principles of rate fixation in fire insurance?

PART-B- Broad Questions

Marks- 15x3=45

8. (a) What are various clauses of marine insurance policies?

   (b) A ship was caught by a cyclone in the sea. A part of the cargo was dropped in the sea and the ship was dragged manually to the safe zone. The ship was however partly damage. The partial loss and expenditure in this connection are given below. Prepare a statement showing general average loss and its adjustment to various partners involved:-

Partial loss and other expenditure                                               Taka

Damage of ship                                                                               30,000

Dragging expenditures                                                                  40,000

Cargo dropped                                                                               15,000

Freight loss                                                                                      8,000

Other information’s

Ship (original value)                                                                5, 50,000

Goods (original value)                                                             3, 00,000

Freight (original value)                                                              25,000

9. (a) What do you mean by the following policies in fire insurance valued policies, reinstatement policies and adjustable policies?

(b) Discuss contribution and average clause in fire insurance claims.

(c) Discuss the procedure of settlement of fire insurance claims.

(d) X & Co. was insured their factory building for tk. 2, 50,000  to XYZ Co. & for TK.1,50,000 to ABC Co. the factory was destroyed by fire and actual loss was ascertained tk. 1,00,000. How much the insured can recover from the each insurer?

10. (a) What are the various option of bonus?

(b) How general average loss is different from particular average loss?

(c) Insurance is able to curtail inflation. So it should be made compulsory –comment.

(d) What are the various kinds of marine insurance policies?

11. (a) Briefly explain different types of insurable risk.

(b) Describe the steps involve in the risk management process.

12. (a) Distinguish between endowment and term life policy.

(b) Calculate the net NSP and NAP for 5 years term policy from the following information:-

Age	No. of persons insured	No. of death	Present Value of tk.1@4%
31	9480	125	.952
32	9,355	126	.907
33	9,229	128	.864
34	9,101	130	.823
35	8,971	136	.784

*** Policy value tk. 10,000