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"'" INSURANCE (!{ RISK MANAGEMENT
(IRM) FXAMINf\.TION.
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MAY2010
P-4-Bt:s .ess Strategic Planning and
Idormation Tecbnolo".
Roll No...............................
Total No. of Questions-':"'S] [Total No. of Printed Pages-1O
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Time Allowed-3 Hours Maximum Marks~OO
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Answer all questions.
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SECTION-A
1. Objective type questions: lx20=20
(a) Which of the following is not a way in which multinational firms can structure
their Global Insurance Programme?
(i) They can buy insurance in one country and arrange for coverage w:herever
they do business
(ii) Have their own Insurance Companies?
(iii) Allow local management in each country to purchase insurance.
(iv) By using a master programme that is globally controlled and coo~dinated
by Global Insurer through subsidiaries, associated or partners. '
(b) The key document in outsourcing agreemen.ts that helps to strategic.relationship
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including the identification of responsibilities and results is
(i) Memorandum -of understanding
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(ii) Mutual current letter
(iii) Service level agreement
(iv) Strategic level agreement.
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(c) networks connect peripherial devices of remote location with
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a single central processor usually a main frame computer.
Distributed system network
CD
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(ii) Local area network
(iii) Distributed area network
(iv) Teleprocessing network.
(d) The Central processing unit requires the instructions to be written in a
form in order to carryon the functions.
(i) Machine language,
(ii) Binary
(iii) Procedural language
(iv) Either CDor (ii).
(e) The device in a Computer system record data by changing the state of
and constituting the peripherials.
(i) Magnetic devices and Transistors
(ii) IC's and Electromagnets
(iii) Circuits and Magnetic devices
(iv) Anyone of the above.
(f) is a non-procedural language similar toa fourth generation
language composed of high level commands that DBMS software interprets
and executes.
(i) Data question language
(ii) Data query language
(iii) Data dictionary
(iv) None of the above.
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(g) In order to be an appointed actuary for an insurer, a person shall satisfy the
following:
(i) must be ordinarily resident in India
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(ii) must be an employee of the insurer or a consulting actuary in case of
general insurance business
(iii) must possess a certificate of practice issued by the Actuarial Society of
India
(iv) All of the above.
(h) : refers to the ~tructuring of hardware and software to achieve
effective and efficient information processing.
(i) System objective
(ii) System development
(iii) System integration
(iv) System implementation.
(i) Once the design team identifies the necessary features for the system, which
of the following are chosen
(i) In-house development
(ii) Software development companies
(iii) Computer manufacturers
(iv) Anyone of the above.
(j) The data structure/(s) common among information systemiCs) is/Care)
(i) Tree
(ii) Network
(iii) Relational
(iv) All of the above.
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"(k) Insurers could retrieve from query and reporting tools the following:
(i) Agency listing
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(ii) Loss reserves by accident year
(iii) Loss ratios by line of business
(iv) All of the above.
(l) The benefits of customer relationship marketing for an organisation include
(i) Increasing sales
(ii) Higher costs
(iii) Employee allocation
(iv) All of the above.
(m) Symmetric key encryption approach uses a specified data field
as the encryption key.
(i) Double
(ii) Single
(iii) Either (i) or (ii)
(iv) None of the above.
(n) In a data flow diagram, match the following correct combination :
(a) Processes (i) Squares
(b) Data flow (ii) Arrows
(c) Data store (iii) Rectangles
(d) External destination for data (iv) Circles.
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(0) Asset-Liability management by an insurance company involves m......................
and
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(i) affordable price.. quality, servIce
(ii) proper product design, asset management
(iii) flexibility, affordable price
(iv) affordable price, flexibility.
(p) In the process of defining the logic of a programme, the programming team
create's several types of documentation, these include the following, except
(i) Structure charts
(ii) Test papers
(iii) Memos, working papers
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(iv) Pseudo codes.
(q) - System implementation begins when the information system steering committee
the detailed specification produced during system. design. It
ends with the acceptance of the system of management as an operation success
(i) Accepts
(ii) Rejects
(iii) Accepts
(iv) None of the above.
(r) Critical business intelligence success factors for an insurance company do not
include,
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(i) Develop a clear project plan and scope
(ii) Obtain knowledgeable staff
(iii) Do not involve end user
(iv) Select insurance specific data model.
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(s) The Premium charged by an Insurance Company depends on
(i) amount of anticipated loss
6i) cost of doing business 4
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(iii) both (i) and (ii)
(iv) Anyone of the above.
(t) Broad guidelines adopted by a rate-maker do not include which one of the
following?
(i) The rate should be adequate to meet loss burden, yet not be excessive
(ii) The rate should allocate cost burden among insured on a fair. basis
(iii) The rate should encourage loss control efforts among insureds, if possible
(iv) The rate should predict and prevent loss making events.
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2. Match Part 'A' with Part 'B' :
Part 'A' Part 'B'
1. Rapid application development and (a) What activities to outsource,
estimating costs and benefits, and
object oriented approaches ..............
finally choosing the outsourcer.
2. Case tools increase the productivity (b) Pure premium and loading, the
insurer must also ,make allowance
of personnel assigned to project
teams ,......... for the credibility 'factor or extent
to whichhe can rely on the loss
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experIence.
. 3. To assist in the control of (c) That help ensures that
transactioilsare valid, properly
development projects, there are
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several project management authorised, and completely and
tools, .............. accurately processed.
4. The methodology of outsourcing (d) And at the same time, improve
begins with determining .............. the quality of the new system
and their documentation.
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5. BPR is on going activity that focuses (e) This is carried out by a
on the redesign of business processes systematic process to identify and
eliminate all nonvalue-added
to achieve dramatic improvement
in performance activities. 4
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Are intended to shorten
6. The make up of the insurance (f)
premium is a function of .............. development time and decrease
costs.
7. Insurers are now investing large (g) Are post implementation review,
sums in business intelligence system maintenance, and
tools; .............. accounting for system costs.
8. Information system controls, that (h) Which comprise of datamarts,
datawarehouses and various
affect only a specific application
are application controls .............. types of querying and reporting
tools.
9. As humans, we think of data as (i) Some information system do not
consisting of characters, fields, use files, instead they use
records, files, and the database management system
database, .............. to store and locate data records.
10. Three activities, that involve (j) Like context diagram; work
accountant and auditors, during breakdown structures, gantt,
operation phase, .............. pert, CPM charts.
3. Expand the .following: 10~ ,
1. GC
2. CD
.3. DFD
4. WBS
5. MOLAP
6. ASCII
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7, CASE
8, EDI
9, OOPS ~
10. VAN
11. EBCDIC
12, DSS
13, ROLAP
14. DQL
15. DBA
16, GP = PP + LP (GP)
17, DM
18, RAD
=
- 19, PP PPi (Z) + PPp (1 - Z).
20, WAN.
SECTION-B
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4. Short descriptive questions'
(a) State the reasons for the system failure and explain any three.
(b) Name various functions of Insur'ers and describe any thr:~e..
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5. (a) How do you think multinational companies can structure their Global Insurance
Programme? -
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(b) What is Generalised Audit Software? Discuss its advantages.
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6. (a) Discuss Auditor's involvement in System Design- with reference to Audit
module, Processing steps and Specification review:.
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(b) Identify the risks that arise mostly from reasons other than weakness in data
security and discuss in brief.
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SECTION-C'
CASE STUDY
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7. A Life Insurance Company is to manage so much to data pertaining to various
departments in the company, the intermediaries, the customers and various other
activities.
The number of policyholders in the leading insurance firm in India is more than
10 million. The products offered are so diverse with many permutations and
combinations. The intermediaries that distribute the insurance products, -like agents
are numbering around ten lakhs and the customer grievances/claims have to be
properly managed to keep the customers happy. The medical records and other
particulars of the customers have to be kept safe for a number of years.
As the number of years for which the business is done grows, the data turns out
to be very huge and enormous. With the setting up of private insurance companies,.
further increase in data relating to customers is generated. More work is generated
in the areas of policy servicing, new business acquisition, billing, loans, investmept,
personnel management and office services. All the information needs to be streamlined
to stay competitive.
Every insurance company also should maintain close coordination between. its
head office, regional offices, divisional offices and branch offices.
Q. How do you think all this can be achieved using modern science and
technology?
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8. The Indian Railways seems to be the most sought after way of transport-for the
common man in India. Surprisingly enough we find that almost all the trains run
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full and the last minute efforts to get reservation always have long lines ofpassengers
eagerly waiting to get their tickets.
Till a few years' back, the waiting period was what made the things really
disappointing because until the last minute the reservation clerk was,not revealing
the position,
People who wanted to make a long distance travel involving two or more
trains too had nightmares because a confirmed reservation ticket was being
issued from the originating station to the changing point from where another
reserved ticket should be availed. A telegram used to be sent to the station at
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th~ changing point requesting to hook the reserved ticket. However, in most of
the cases, the passenger used to hear from, the reservation clerks at the station
at changing point that they have not received any communication at all or
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there is no availability of reservation. This naturally used to put many passenge.rs
to difficulty not knowing how to proceed further as their entire plan gets
upset.
Thanks to the modern technology of computers and networking, the times have
changed and railways hp.ve taken many initiatives to help the customers. Now
the customers need not wait in the lines to know the reservation position, they
can enquire about the latest position through more effective telephone lines or
~omputer terminals set up. outside the reservation counters, which provide
minute to minute details.
Passengers have the convenience to reserve their tickets from any place to any
place in India sitting at' any single location. They can themselves see the
reservation position on the Internet and book their tickets on line. They can
ev'en cancel any ticket at any place in India, without bothering about the place
of purchase of the ticket.
-Q. How do you think the data processing is managed in such a situation?
Discuss.
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