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Risk Management > MIDTERM REVIEWER > Flashcards

MIDTERM REVIEWER Flashcards

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1
Q

Refers to a thing providing protection against possible eventuality

A

Insurance

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2
Q

Refers to the assessment and quantification of the likelihood and financial impact of events that may occur in the customers world that require settlement by the insurer.

A

Insurance Risk Management

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3
Q

Types of Risk Management

A
  1. Business Risk
  2. Non Business Risk
  3. Financial Risk
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4
Q

Is the exposure a company or organization has to factor that could lower its profits or lead it to fail.

A

Business Risk

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5
Q

Anything that threatens a company’s ability to achieve its financial goals is considered a __________

A

Business Risk

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6
Q

Whether a company can make enough sales and revenue to cover its expenses and turn a profit

A

Business Risk

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7
Q

What makes us whole when things go wrong in both personal and business lives

A

Risk Management and Insurance

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8
Q

Arise due to uncertanties

A

Business Risk

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9
Q

is when it is not known what
is going to happen in future.

A

Uncertainty

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10
Q

Examples of Uncertainties that affects the business are:

A
  1. Change in Demand
  2. Change in Technology
  3. Change in Government Policy
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11
Q

Identification, evaluation, and prioritization of risk followed by economical and coordinated application of resources to minimize, monitor, and control the probability of impact of unfortunate events.

A

Risk Management

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12
Q

Importance of Risk Management and Insurance

A

Allows our lives and economy to operate smoothly despite the risk and reality that bad thing will occasionally happen.

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13
Q

Examples of Business Risk

A
  1. Damage by fire
  2. Flood
  3. Natural Disasters
  4. Unexpected financial loss due to an
    economic down turn (pandemic)
  5. Bankruptcy of other businesses.
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14
Q

4 Types of Business Risk

A
  1. Strategic Risk
  2. Compliance and Regulatory Risk
  3. Financial Risk
  4. Operational Risk
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15
Q

A competitor coming on to the market

A

Strategic Risk

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16
Q

Introduction of new rules and legislation

A

Compliance and Regulatory Risk

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17
Q

Interest rate rise on your business loan or a non paying customer

A

Financial Risk

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18
Q

The breakdown or theft or key equipment

A

Operational Risk

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19
Q

Sources of Strategic Risk

A
  1. Mergers, acquisitions and other competition.
  2. Market or industry changes
  3. Changes among customers or in demand
  4. Change management.
  5. Human resource issues such as staffing.
  6. Financial issues with cashflow, capital or
    cost pressures.
  7. It disasters and equipment failure
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20
Q

RELATES TO A POTENTIAL CHANGE IN LAWS AND REGULATIONS ,

A

Regulatory Risk

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21
Q

RELATES TO THE POTENTIAL OF YOUR BUSINESS TO VIOLATE EXISTING LAWS OR REGULATIONS.

A

Compliance Risk

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22
Q

Common compliance risks involve illegal practices and include:

A

• Fraud
• Theft
• Bribery
• money laundering
• embezzlement

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23
Q

A common compliance risk is the violation of:

A

• privacy laws
• hacking, viruses
• and; malware are some of the cyber
risks that affect organizations.

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24
Q

refers to the internal and external events that may make it difficult or even impossible for an organization to achieve their objectives and strategic goals

A

Strategic Risk

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25
Identifying, Assessing, and Controlling threats to an organizations capital and earnings.
Risk Management
26
do not derive from the products or services supplied. For example, risk that are associated with the long-term sources of finance used.
Non Business Risk
27
is a potential future situation that causes your business to lose money. The situation could affect your cashflow and leave you unable to meet your obligations.
Financial Risk
28
Examples of Financial Risk
- Loss of investment assets - Theft - Damage to assets you own - Assets values depreciating or depreciating in value - Insufficient savings to continue investing
29
Other Functions of Insurance
• Provides Certainty • Provides Certainty of payment at the uncertainty of loss • Provides protection. • Risk Sharing • Prevention of losses • Promotes Economic Development • Improves Efficiency
30
Can be defined as a contract between an insurance policy holder and an insurance company, where the insurer promises to pay a sum of money in exchange for a premium, upon the death of an insured person or after a set period.
Life Insurance
31
Primary Purpose of Insurance. Protection against:
1. Future Risk 2. Accidents 3. Uncertainties
32
2 core Functions of Insurance
1. Protection 2. Safety
33
Importance of Insurance
1. Financial Safety Net 2. Helping you and your loved ones recover after bad things happen
34
When you purchase an insurance, you will receive an ______________ which is legal contract between you and your insurance provider.
Insurance Policy
35
is the price you pay to buy an insurance policy. Premiums are your regular payments for many common insurance policies including: o Life o Auto o Business o Homeowners o Renters
Insurance Premium
36
is a government agency under the DEPARTMENT OF FINANCE.
Insurance Commission
37
SUPERVISES AND REGULATES THE OPERATIONS OF LIFE AND NON-LIFE COMPANIES, MUTUAL BENEFIT ASSOCIATIONS, HMO (HEALTH MAINTENANCE ORGANIZATIONS) AND TRUST FOR CHARITABLE PURPOSES.
Insurance Commission
38
Used to be part of the central bank
Insurance Commission
39
Insurance Commission started on
January 4, 1949
40
Prudent move to establish a separate regulator for the insurance industry
Insurance Commission
41
To ensure that insurance company adopt good corporate governance policy.
Insurance Commission
42
Secretary of Finance
Benjamin Diokno
43
Felipe Medalla
Governor of BSP
44
It helps you make sure you are prepared for life’s unfavorable circumstances such as sickness, disability, old age and death.
Importance of Life Insurance
45
Common Types of Insurance in the Philippines
1. Life insurance 2. Health or medical insurance 3. Savings and investment
46
If you fail to pay your premiums you risk having your policy _________ ?
Cancelled
47
It protects the interests of the insuring public.
Insurance Commission
48
Two major types of life insurance
1. Traditional Life 2. Variable Life
49
Focuses primarily on guaranteed death and or living benefits a type of life insurance contract that provides for insurance coverage of the contract holder for their entire life.
Traditional Life
50
It is a policy that pays a specified amount to your family or your beneficiaries upon your death.
Variable Life
51
Top 1 insurance in the Philippines in terms of asset
Pru Life insurance corporation of UK
52
Examples of Traditional Life Insurance Products
1. Endowment Policies 2. Whole Life Insurance Policies 3. Retirement Plans 4. Money Back Plans
53
a life insurance contract designed to pay a lump sum after a specific term or on death typically maturities are, 10, 15 and 20 years.
Endowment Policies
54
Buong buhay
Whole life insurance policies
55
Pagka retire
Retirement Plans
56
Babalik yung pera kasi wala nangyari sa sarili
Money Back Plans
57
Top 5 Insurance companies in the Philippines in terms of Assets
1. Pru Life Insurance corporation of UK 2. The Philippine Americam Life and General zinsurance co. Inc 3. Sun life of Canada Inc. 4. Philippine Axa Life Insurance corporation 5. Insular life assurance company LDT.
58
Advantages of Variable Universal Life Insurance
1. A death benefit that wont decrease as long as you continue to make your minimum premium payments on time. 2. Flexible Premium Payment options 3. The potential to earn higher than average returns compared to other types of permanent life insurance.
59
an act strengthening the insurance industry.
Republic Act No. 10607
60
amending presidential decree No.612. Otherwise known as the insurance code
Republic Act No. 10607
61
How to control Financial Risk
1. Identify and measure the risk 2. Decide on the level of risk you are willing to accept 3. Consider insurance to protect against business risk 4. Identify Potential issues with cashflow 5. Review your financial arrangements with creditors.
62
A person or persons who will receive the death benefit from your life insurance policy, When you. If you die without naming anyone, the money will go to your estate. (The sum of all your property possessions, financial assets and debts) by default.
Beneficiary
63
is the person or entity that you legally designate to receive the benefits from your financial products. For life insurance coverage, that is the debt benefit your policy will pay if you die.
Beneficiary
64
4 Classes of Beneficiary
1. You and your spouse 2. Friends and Family 3. Charity 4. Government
65
3 Types of Beneficiaries
1. Primary Beneficiaries 2. Contingent Beneficiary 3. Residuary Beneficiary
66
is the person (or people or organizations) you name to receive your stuff when you die. Typically, your spouse.
Primary Beneficiary
67
is the second in line to receive your assets in case the primary beneficiary passes away.
Contingent Beneficiary
68
gets any property that isn’t specifically left to another beneficiary.
Residuary Beneficiary
69
PREMIUM MODE OF PAYMENT
- One time or Lump sum - Yearly - Semi annually - Quarterly - Monthly
70
More often than not, people select their _________ as their primary beneficiary
spouse
71
and then name their __________ as contingent or secondary beneficiaries.
children
72
Is a person whose name is recorded on the legal documentation by the force of law or a decree.
Named Beneficiary
73
This person is the sole or shared collector of benefits from the trust, insurance policy, pension plan, annuity etc.
Named Beneficiary
74
regular payments for many common insurance policies
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Risk Management (2 decks)

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