Associate PRM Practice Questions - PRMIA Associate Professional Risk Manager Certificate Exam - Associate PRM Practice Questions - PRMIA Associate Professional Risk Manager Certificate Exam

Question 1

Which of the following BEST distinguishes 'risk' from 'uncertainty'?

Risk and uncertainty are interchangeable terms in modern risk management Risk involves outcomes whose probabilities can be estimated; uncertainty involves outcomes whose probabilities cannot be quantified Risk only refers to negative outcomes; uncertainty only refers to positive outcomes Risk is always insurable; uncertainty is always uninsurable

Correct Answer:

Risk involves outcomes whose probabilities can be estimated; uncertainty involves outcomes whose probabilities cannot be quantified

Question 2

A speculative risk differs from a pure risk because:

Speculative risk involves only loss; pure risk involves loss or gain Speculative risk involves the possibility of gain or loss; pure risk involves only the possibility of loss or no loss Pure risk is faster to materialise than speculative risk Speculative risk is always insurable

Correct Answer:

Speculative risk involves the possibility of gain or loss; pure risk involves only the possibility of loss or no loss

Question 3

In risk-management terminology, which term refers to a CONDITION that increases the chance or severity of a loss (e.g. oily rags in a workshop)?

Peril Hazard Exposure Loss event

Correct Answer:

Hazard

Question 4

A 'moral hazard' refers to:

A physical condition that increases loss frequency A change in behaviour caused by the existence of insurance or another risk-transfer arrangement that increases the probability or severity of loss An ethical violation by a financial professional A natural-disaster exposure that cannot be priced

Correct Answer:

A change in behaviour caused by the existence of insurance or another risk-transfer arrangement that increases the probability or severity of loss

Question 5

Expected loss in basic risk-management terms is approximated by:

Frequency × Duration Frequency × Severity Severity ÷ Frequency Probability × Confidence Level

Correct Answer:

Frequency × Severity

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About this Exam

Prepare with the Associate PRM Practice Questions - PRMIA Associate Professional Risk Manager Certificate Exam practice quiz. This question bank includes 100 questions covering risk, described, market, distribution, and loss. Use it to review important concepts, identify knowledge gaps, and build confidence for the related exam, course, or assessment.

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Associate PRM Practice Questions - PRMIA Associate Professional Risk Manager Certificate Exam

This practice set contains 100 questions from the matching question bank and focuses on risk, described, market, distribution, and loss. Work through each question carefully, review the provided solutions, and revisit topics that need more study before your next attempt.

This is an independent study resource intended for practice and review; it is not an official examination or an endorsement by any organization named in the title.

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Associate PRM Practice Questions - PRMIA Associate Professional Risk Manager Certificate Exam

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