Risk Management - CMCA Test Preparation Accurate 100%
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Course
CMCA
Institution
CMCA
TRUE - ANSWER TRUE or FALSE
Risk management is the process of making and carrying out decisions that will minimize the adverse effects of accidental losses upon the community association.
c. income exposure to loss - ANSWER What type of Exposure to Loss for a community association is characte...
Risk Management - CMCA Test
Preparation Accurate 100%
TRUE - ANSWER TRUE or FALSE
Risk management is the process of making and carrying out decisions that will minimize
the adverse effects of accidental losses upon the community association.
c. income exposure to loss - ANSWER What type of Exposure to Loss for a community
association is characterized by net losses that may involve a reduction in income or an
increase in operating expenses or both?
a. property exposure to loss
b. liability exposure to loss
c. income exposure to loss
d. personnel exposure to loss
d. personnel exposure to loss - ANSWER What type of Exposure to Loss for a
community association is characterized by claims by employees regarding
discrimination in hiring or firing, harassment, or other allegation.
a. property exposure to loss
b. liability exposure to loss
c. income exposure to loss
d. personnel exposure to loss
b. liability exposure to loss - ANSWER What type of Exposure to Loss for a community
association is characterized by damage to non-association property or to a person,
arising when a person or entity threatens or actually brings a legal claim against the
community association, its members, or others whom it must indemnify by contract?
a. property exposure to loss
b. liability exposure to loss
c. income exposure to loss
d. personnel exposure to loss
a. property exposure to loss - ANSWER What type of Exposure to Loss for a community
association is characterized by tangible losses to association property such as buildings
and their contents or Intangible, such as the loss of information or someone hacking into
the community website.
a. property exposure to loss
b. liability exposure to loss
c. income exposure to loss
,d. personnel exposure to loss
TRUE
Surveys and questionnaires
Financial Reports - Asset entries detail property exposures and liability entries explain
continuing obligations.
Records, files and documents
Flowcharts detail association paper flow and critical tasks.
Personal Inspections
Hire experts, including Reserve Specialists, insurance risk managers and qualified
general contractors - ANSWER TRUE OR FALSE:
The following resources can help identify exposures to loss:
Surveys and questionnaires
Financial Reports
Records, files and documents
Flowcharts
Personal Inspections
Experts
b. Frequency - ANSWER Tests of Significance: Loss __________ refers to the number
of times a financially adverse event occurs or is expected to occur.
a. Severity
b. Frequency
a. Severity - ANSWER Tests of Significance: Loss __________ refers to the expected
dollar loss when a financially adverse event occurs.
a. Severity
b. Frequency
1. c. Loss reduction
2. b. Loss prevention
3. d. Segregation of exposures
4. e. Contractual transfer
5. a. Exposure Avoidance - ANSWER Risk Control is a one way to treat the primary
exposures to loss.
Match the terms:
1. Minimize the severity of the loss if something does happen.
2. Take steps to reduce the likelihood of a potential loss.
, 3. Separating and duplicating activities and personnel performing them.
4. Moving the legal and fiscal responsibility to another party.
5. Eliminating the chance of loss by stopping or never starting an activity.
a. Exposure Avoidance
b. Loss prevention
c. Loss reduction
d. Segregation of exposures
e. Contractual transfer
1. (b) Income
2. (d) Liability
3. (c) Personnel
4. (a) Property - ANSWER Match the Types of Insurance Coverages:
1. Covers losses from a reduction in revenue and/or an increase in expense
2. Covers damage to non-association property or to a person when a legal claim is
brought against the association
3. Covers losses from claims of an employee against the association
4. Covers losses to tangible or intangible community association property
a. Property
b. Income
c. Personnel
d. Liability
TRUE - ANSWER TRUE OR FALSE
NEVER admit negligence for liability claims. - ANSWER Which of the following is NOT a
rule for insurance claims?
a. Always meet specific requirements for filing claims.
b. Notify the insurer of claims with a potentially adverse financial impact.
c. Present proof of loss.
d. Minimize further loss.
e. Admit negligence for liability claims.
1. HO-6
2. HO-1, HO-2, HO-3, and HO-5
3. HO-4 - ANSWER Match the different type of Homeowner (HO) policies. Same may
be used more than once.
1. Policies specifically for a condominium or cooperative unit owner.
2. Policies for owner-occupied single-family homes.
3. Tenant's policy.
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