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CPCU 500 Exam
CPCU 500 Exam & Practice Exam
Questions and Answers Practice
Questions with Solutions Newest |
Already Graded A+
The control technique that uses backups, spares, or copies of critical property, information, or
capabilities and keeps them in reserve is which one of the following risk management
techniques?
A. Risk transfer
B. Diversification
C. Separation
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CPCU 500 Exam
D. Duplication –
Correct Answer :D. Duplication
Concerning fundamental guidelines of contractual risk transfer management, it is wise to:
A. Be aggressive in negotiations—the more ruthless the better.
B. Require a certificate of insurance for contractual liability before contract operations begin.
C. Try to be as general and nonspecific as possible.
D. Avoid being named as an additional insured on the transferee's policy. –
Correct Answer :B. Require a certificate of insurance for contractual liability before contract
operations begin.
One type of noninsurance risk control transfer, a disclaimer of warranties, is used to:
A. Deny any express warranties made in conjunction with the sale of property.
B. Recognize and validate the assumption of contractual liability.
C. Deny an exculpatory clause.
D. Reinforce implied warranties of merchantability.
- Correct Answer :A. Deny any express warranties made in conjunction with the sale of
property.
In both noninsurance risk control and noninsurance risk financing transfers,
A. The transfer becomes effective only when the transferee actually performs the action that
rids the transferor of risk.
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CPCU 500 Exam
B. A contract is usually formed before any loss occurs.
C. The transferor has protection only after the funds to restore a loss are paid.
D. The transferor has protection regardless of the transferee's bankruptcy.
- Correct Answer :B. A contract is usually formed before any loss occurs.
A1 Architectural Design relies on its historical files and blueprints. The partners of the firm are
discussing risk control measures that can be implemented to provide protection against
property-related losses. Which one of the following would likely offer the best protection for
this exposure?
A. Separation
B. Avoidance
C. Diversification
D. Duplication –
Correct Answer :D. Duplication
The risk control technique that spreads loss exposure over numerous projects, products,
markets, or regions is which one of the following risk management techniques?
A. Duplication
B. Diversification
C. Separation
D. Risk transfer –
Correct Answer :B. Diversification
, 4
CPCU 500 Exam
Leasing is a useful noninsurance risk control transfer because:
A. The lessee retains the loss exposures resulting from property destruction.
B. The lessee stands to lose the property's rental income in the event of damage to the
property.
C. Certain loss exposures accompany property ownership but do not accompany its use or
occupancy.
D. The lessor loses the ability to use the property for the remainder of the lease in the event
of damage to the property. –
Correct Answer :C. Certain loss exposures accompany property ownership but do not
accompany its use or occupancy.
Which one of the following is true about the liability involved in contracting services?
A. In contracting for services, the party that transfers the risk must be an independent
contractor, and the party that accepts the risk must be a subcontractor.
B. The responsibility that certain duties be performed safely cannot be delegated to another
party, such as the duty of common carriers to carry passengers safely.
C. If the party that hired the contractor is negligent in selecting the contractor, the contractor
is directly liable for such negligence.
D. If the subcontracted work is inherently dangerous to others, the party who hired the
contractor is not liable for an injury to a third party caused by the contractor's negligence. –
Correct Answer :B. The responsibility that certain duties be performed safely cannot be
delegated to another party, such as the duty of common carriers to carry passengers safely.
An organization that operates warehouses in two locations is using the risk control technique
of:
CPCU 500 Exam
CPCU 500 Exam & Practice Exam
Questions and Answers Practice
Questions with Solutions Newest |
Already Graded A+
The control technique that uses backups, spares, or copies of critical property, information, or
capabilities and keeps them in reserve is which one of the following risk management
techniques?
A. Risk transfer
B. Diversification
C. Separation
, 2
CPCU 500 Exam
D. Duplication –
Correct Answer :D. Duplication
Concerning fundamental guidelines of contractual risk transfer management, it is wise to:
A. Be aggressive in negotiations—the more ruthless the better.
B. Require a certificate of insurance for contractual liability before contract operations begin.
C. Try to be as general and nonspecific as possible.
D. Avoid being named as an additional insured on the transferee's policy. –
Correct Answer :B. Require a certificate of insurance for contractual liability before contract
operations begin.
One type of noninsurance risk control transfer, a disclaimer of warranties, is used to:
A. Deny any express warranties made in conjunction with the sale of property.
B. Recognize and validate the assumption of contractual liability.
C. Deny an exculpatory clause.
D. Reinforce implied warranties of merchantability.
- Correct Answer :A. Deny any express warranties made in conjunction with the sale of
property.
In both noninsurance risk control and noninsurance risk financing transfers,
A. The transfer becomes effective only when the transferee actually performs the action that
rids the transferor of risk.
, 3
CPCU 500 Exam
B. A contract is usually formed before any loss occurs.
C. The transferor has protection only after the funds to restore a loss are paid.
D. The transferor has protection regardless of the transferee's bankruptcy.
- Correct Answer :B. A contract is usually formed before any loss occurs.
A1 Architectural Design relies on its historical files and blueprints. The partners of the firm are
discussing risk control measures that can be implemented to provide protection against
property-related losses. Which one of the following would likely offer the best protection for
this exposure?
A. Separation
B. Avoidance
C. Diversification
D. Duplication –
Correct Answer :D. Duplication
The risk control technique that spreads loss exposure over numerous projects, products,
markets, or regions is which one of the following risk management techniques?
A. Duplication
B. Diversification
C. Separation
D. Risk transfer –
Correct Answer :B. Diversification
, 4
CPCU 500 Exam
Leasing is a useful noninsurance risk control transfer because:
A. The lessee retains the loss exposures resulting from property destruction.
B. The lessee stands to lose the property's rental income in the event of damage to the
property.
C. Certain loss exposures accompany property ownership but do not accompany its use or
occupancy.
D. The lessor loses the ability to use the property for the remainder of the lease in the event
of damage to the property. –
Correct Answer :C. Certain loss exposures accompany property ownership but do not
accompany its use or occupancy.
Which one of the following is true about the liability involved in contracting services?
A. In contracting for services, the party that transfers the risk must be an independent
contractor, and the party that accepts the risk must be a subcontractor.
B. The responsibility that certain duties be performed safely cannot be delegated to another
party, such as the duty of common carriers to carry passengers safely.
C. If the party that hired the contractor is negligent in selecting the contractor, the contractor
is directly liable for such negligence.
D. If the subcontracted work is inherently dangerous to others, the party who hired the
contractor is not liable for an injury to a third party caused by the contractor's negligence. –
Correct Answer :B. The responsibility that certain duties be performed safely cannot be
delegated to another party, such as the duty of common carriers to carry passengers safely.
An organization that operates warehouses in two locations is using the risk control technique
of:
