Flashcards on Introduction to Insurance and Assurance
Introduction to Insurance & Assurance: A Student's Guide
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Insurance and Assurance
23 cards
Card 1
Question: Name three compulsory types of insurance mentioned.
Answer: Unemployment insurance (UIF); Compensation for occupational injuries and disease act (COIDA); Road Accident Fund (RAF).
Card 2
Question: List five insurable risks from the content.
Answer: Fire; Vehicle; All weather; Insurance of money in transit; Fidelity insurance (also: Liability, Crop, Group life cover, Loss of income).
Card 3
Question: Give three disadvantages of insurance.
Answer: Insurance premiums are costly; Premium money could be used for investments; Items commonly stolen (laptops, phones) are often excluded from policies.
Card 4
Question: Give three disadvantages of life assurance.
Answer: Policy might not be sufficient to provide for remaining family members; It is costly and affects current cash flow for long-term benefit; It is a comp
Card 5
Question: What risks are non-insurable according to the content?
Answer: Normal operational risks (inflation, changes in fashion, machinery improvements, bad debts); Losses from war, nuclear weapons and radiation; Illegal a
Card 6
Question: State two main reasons people or businesses take out insurance or assurance.
Answer: To protect against possible loss and place the insured back in the same financial position (indemnification); Life assurance provides security to fami
Card 7
Question: Explain the difference between insurance and assurance in one sentence.
Answer: Insurance is for if something happens (principle of indemnity); assurance is for when something happens (principle of security).
Card 8
Question: Name four types of life assurance and related covers listed.
Answer: Term assurance; Endowment; Retirement annuity; Disability cover (also: Trauma/dread disease and Funeral cover).
Card 9
Question: Define 'risk' in the context of insurance.
Answer: Risk is the likelihood of an unfavourable event occurring (the chances of it happening).
Card 10
Question: What is a 'peril' in insurance terms?
Answer: A peril is a potential cause of loss, such as fire or theft.