a) Define the term risk. [2 Marks] b) In non-insurance transfer, the risk is transferred to a party.

a) Define the term risk. [2 Marks]

b) In non-insurance transfer, the risk is transferred to a party other than an insurance company.

Explain the three major forms of non insurance risk transfer. [6 Marks]

c) List three advantages of an insurance cover. [3 Marks]

d) Explain the following phases of the risk identification process;

i.)Initial risk identification ii.)Continuous risk identification [4 Marks]

e) List five responses that can be initiated within an organization to manage risk. [5 Marks]

f) Explain the partnership model in risk management. [5 Marks]

g) Briefly explain four benefits of good risk management within an organization.

[5 Marks]

QUESTION TWO (20 MARKS)

a) Define the term risk management. [1 Mark]

b) Explain the following risk management models;

i.)The ‘three lines of defence’ model ii.)The ‘offence and defence’ model

iii.)The policy and policing model [9 Marks]

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c)Explain five principles for effective risk management. [10 Marks]

QUESTION THREE (20 MARKS)

a) Define the term risk financing. [2 marks]

b) Explain the following methods of risk financing

i.)Retention ii.) Non-insurance Transfers iii.) Commercial Insurance [6 Marks]

c) List three scenarios where retention can be effectively used as a risk financing method.

[3 Marks]

d) Explain three essentials of an insurance contract. [6 Marks]

e) List three advantages of non insurance risk transfer. [3 Marks]

QUESTION FOUR (20 MARKS)

a) Explain two characteristics of risk. [4 Marks]

b) Explain the following terms as used in risk management. [4 Marks] i.)residual risk ii.)inherent risk

c) Describe the following techniques for Handling Risks. [8 Marks] i.)Risk shifting ii.)Risk avoidance iii.)Risk reduction iv.)Risk assumption

d) Explain how the process of risk self assessment may be carried out within an organization.

[4 Marks]

QUESTION FIVE (20 MARKS)

a) Define the following terms;

i.)Crime risk.

ii.)Property Risk [4 Marks]

b) List six activities associated with financial crime risk. [6 Marks]

c) Describe the ‘know your customer’ rule as an essential component of financial crime risk

management. [5 Marks]

d) List five categories of customers that an institution should conduct increased vigilance.

[5 Marks]

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