Insurance & Risk Management BBA Second year Fourth Semester examination 2008

BBA second year fourth semester examination, 2008

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- 5*5=25

1.       (a) Insurance is systems of spreading the loss of one into the shoulder of many- interpret the statement using suitable example.

   (b)Define risk and differentiate between risk &uncertainty

     2. Briefly explain how the claim of fire insurance is settled

3. Explain the necessity of insurance for economic development of a country like Bangladesh.

4. Describe the principles of utmost good faith and principle of indemnity with their essential and uses.

5. What do you mean by marine perils? State different types of marine insurance pricing.

6. (a) Elucidate insurance  pricing and discuss the objectives of insurance pricing.

   (b)Name the method of insurance pricing.

7. Briefly explain different treaties in re-insurance.

PART-B- Broad Questions

Marks- 15*3=45

8. (a) Why is insurance termed as a cooperative device and a form of risk management?

(b) Discuss the functions of an insurance company.

(c) Briefly describe the steps involve in the risk management process.

(d) Principles of subrogation are a corollary to the principle of indemnity-explain.

9. (a) Differentiate between actual total loss a constructive total loss.

(b) Discuss in brief the valued policy, block policy and blanket policy with regards to marine insurance.

(c) State the essential feature of marine insurance.

10. (a) Distinguish between level premium annuities and single premium annuities.

(b) Calculate the level premium taking imaginary number, considering 3 years of insurance.

11. (a) Briefly explain different fire insurance policies.

(b) Define surplus treaty and differentiate between “excess of loss” and “excess of loss ratio” in the light of re-insurance.

(c) The house worth tk. 1,00,000 was insured for tk. 60,000 under an average policy. The house was destroyed by fire and actual loss was ascertained tk. 20,000. How much can the insured recover from the insurer?

12. (a) Recall the distinctions between representation and warranties.

(b) Define life insurance and discuss different types of life insurance policies.

(c) Calculate the NSP and NAP for 5 years term policy of tk. 5000 from the following information:-

Age	No. of persons insured	No. of death	Present Value of tk.1@4%
26	10,000	200	.962
27	9,800	300	.925
28	9,500	400	.889
29	9,100	500	.855
30	8,600	600	.822