Takaful MCQs.pdf

Takaful MCQ’s 11. All the following must exist to have a legally binding general insurance contract except: a. O er and acceptance b. Consideration c. Legal capacity d. Witnesses 12. Probability Theory measures the a. The chance of a profit to be made b. The number of products that can be...

Takaful MCQ’s 11. All the following must exist to have a legally binding general insurance contract except: a. O er and acceptance b. Consideration c. Legal capacity d. Witnesses 12. Probability Theory measures the a. The chance of a profit to be made b. The number of products that can be made c. The number of participants to enter into agreement d. The chance of a particular event to occur 13. Loss...........answering the question: How big? And Loss................ answers the question: How often? a. Frequency, severity b. Severity, frequency c. Probability, frequency d. Frequency, probability 14. If peril is usually a cause of loss, then increases the chance of a loss. a. Risk b. Work ethics of employees c. Accident d. Hazard 15........... is the insurer in takaful (Islamic Insurance) which is similar to conventional cooperative insurance. a. The takaful Company b. Participants c. Participants Takaful Fund (Risk Pool) d. Both Participants Takaful Fund and Takaful Company 16. Fill the following table with correct information from Item Cooperative Commercial Takaful insurance Insurance Risk Handling a. Sharing- Transferring – Transferring b. Transferring -Transferring - Sharing C. Sharing -Sharing - Transferring D. Sharing -Transferring- Sharing 17. All the following risks are insurable except...... a. Your business is unsuccessful and your loss 25% of your capital because there is a general depression in the country b. You accidentally drive over your neighbor’s kid and killed c. Firemen broken part of the wall of neighbor in order to reach to fire caught to the next house d. Airplane crashes and 40 passengers have been killed 18. Which of the following is not benefit of risk management in insurance a. Identifying the risks b. Measure the risks and prioritize them c. Take the appropriate actions to reduce losses. d. Eliminate risks 19. Risks can be categorized as: a. Fundamental Risk & Mitigation Risk, and Pure Risk & Speculative Risk b. Impure Risk & Speculative Risk, and Mitigation Risk & Fundamental Risk c. Fundamental Risk & Particular Risk, and Pure Risk & Speculative Risk d. Fundamental Risk & Moral Risk, and Pure Risk & Speculative Risk 20. The disadvantages of insurance include: I. It induces fraudulent and inflated claims II. It reduces some people’s interest in loss control. III. Increases litigation. a. I is correct. b. I& I1 are correct c. I & II are correct d. I, II & III are correct. 21. Which of the following is the essential feature of Takaful? a. It is an economic institution b. It is based on the principle of mutuality or co-operation c. Accumulate funds to pay for claims as a result of the operation of specific risks d. All from a, b, and c 22. The saying of prophet Mohamed (Peace be upon him): "Tie the camel first, then submit (tawakkul) to the will of Allah" is implied a strategy to............. the risk. a. Mitigate /Reduce b. Transfer c. Share d. All the above 23. Which of the following insurance policy has Gharar Uncertainty) _ at stages of both premium and claim? a. Term life insurance b. Marine insurance c. Whole of life Insurance d. Medical Insurance 24. What is synonymous with a system of mutual help? a. Consumer Behavior b. High probability of risk-occurrence c. Takaful d. Commercial Insurance 25. " Premium in Takaful is considered as …………. a. The price for transferring risks and payment for protection b. Segregation of risks from the insured to the insurer c. Absolute protection from illness, accidents, and so forth d. Voluntary contribution to participate in protecting each other against defined loss 26. Which of the following contract is existing between Takaful company as operator and PTF as insurer in takaful mechanism for underwriting management? a. Wakalah b. Commit to donate c. Mudarabah d. Musharakah 27. In which type of insurance mechanisms, the contract of insurance is considered as sale (compensations) contract a. Comparative insurance b. Takaful insurance c. Commercial insurance d. Both (a) and (b) 28. Which of the following concepts eliminates the e ect of uncertainty in Takaful contract? a. Mudarabah b. Wakalah c. Tabarru'/Donation d. None from A, B, and C 29. How does Takaful di er from conventional insurance? a. Loss su ered is transferred and not distributed b. Policyholders obtain the sum insured from the insurance company. c. Policyholders participate in risk distribution based on cooperation. d. Speculative loss is fully covered in the Takaful policy. 30. Employee using his vehicle for an organization's purposes, his own vehicle must be insured by a. Employee b. Organization c. Both d. Employee, the Organization may reimburse part or all of the contribution 31.Hassan has an antique car that was totally damaged in a car accident. He insured under a valued policy for $50,000. It is 10% depreciated. The market value of the car at the time of the loss was $40,000. How much should Hasan get? a. 40,000 b. 45,000 C. 36,000 d. 50,000 32. Subrogation is useful in Takaful to: a. reduces the risk b. claims the loss from the participant in the case of accident caused by their negligence c. Assign the right to the Takaful operator to proceed with legal action against those who caused the loss to the participant. d. distributes the loss among the participants 33. Just before the invasion of Kuwait, ABC Insurance Company indemnified one insured with $120,000 for a damaged consignment of foodstu while it was shipped to Kuwait and took the damaged consignment to one of its stores to sell it in an auction. After the liberation of Kuwait, the Insurance Company was able to sell the damaged consignment for $200,000 because of the food shortage in that period. Can the commercial insurer keep the entire amount? Why? a. Yes as per subrogation legal principle b. yes, as per contribution legal principle C. No, subrogation principle is not applied here d. Yes, as per salvage not subrogation principle 34. Ali insured his house against fire for cover amount of 20,000 $; the house value at fire accident was 25,000, the damage estimated 10,000, how much Ali should get? a. 10000 b. 8500 c. 8000 d. 12500 35. Which of the following statements are considered as common elements of takaful management models? i. Providing Qard Hasan by takaful operator to PTF ii, the contribution is considered donation iii. Sharing of surplus between takaful operator and PTF a. Only (i) b. Both (ii) and (iii) c. Both (i) and (i) d. Both (i) and (ii) 36. in which of the following cases of loss, if A considered as first Cause, B second and C third cause, the takaful company should cover the risk in…… a. (A) not Covered, (B) Covered, (C) Covered b. (A) not Covered, (B) Covered, (C) not Covered c. (A) not Covered, (B) not Covered, (C) Covered d. (A) Covered, (B) not Covered, (C) Covered 37. Risks are normally predictable because it is easier to apply the law of large numbers to such risks. a. Fundamental b. Pure c. Subjective d. Speculative 38. All the following risks are insurable except...... a. death of a person b. loss if investment in the stock market c. collapse of new building because of earthquake d. car accident as a result of speed 39. which of the following does not constitute a breach of Utmost good faith? a. non-disclosure of material fact b. deliberate concealment of facts c. fraudulent misrepresentation d. claim for an insured item