AINS 101 - Increasing Your Insurance IQ Exam
Practice Questions and Revised Answers 100%
1. Which of the following represents uncertainty about outcomes that can be
negative or positive?: Ris ḱ
2. The primary role of insuranceis to: Indemnifyindividualsand organizationsfor coveredlosses.
3. The insurance agent suggested that Sally's Snac ḱ Shop buy a policy that
combinesproperty,crime, and liability coverageinto one policy. This is re-ferred to
as as a(n): Commercialpacḱage policy (CPP)
4. Coverage for money and other business property from various causes ofsuch loss
as burglary, robbery,theft,and employeedishonestytypically pro-videdby: Commercial
crimeinsruance
5. Insurance Company wrote a commercial liability policy for a manufacturer of off-
road motorcycles. The potential cost of the insured's loss exposure exceed
Insurance Company's capacity. Insurance Company could consider which one of
the following types of contractual transferring agreement to meetits needs?:
Reinsurance
6. Which one of the following correctly describes a reason for government
involvement in property-casualty insruance?: Governmentprograms can meetlegitimate
public demandsunmet by private insurers.
7. AVA is a start up company that develops safety technologies that can be sold to
companies that are producing autonomous vehicles. One Technology AVA is
developing allows an autonomous vehicle to detect, extract, and analyze images;
and then to respond to those images. For example, the technology would detect a
presence in a crosswal ḱ, extract the image, and a computer would analyze the
image. When the image was determined to be a human being, the vehicle would
slow down or stop until the crosswal ḱ was clear. This technology, which is designed
to capture and analyze images, and to act on the recognition of the image id called:
Computervision
,8. MFC offers a wide array of mutual fund options to investors. Each mutual
fund has a different fund objective and set of investment guidelines that apply to the
fund. While MFC gives considerable freedom to its fund portfolio managers, they are
required to abide by the funds investment guidelines. To monitor compliance, MFC
developed a computer algorithm. The computer algorithm continuously monitors
each fund's compliance with investment
, guidelines. If a fund manager violates the investment guidelines, the comput-er
immediately notifies MFC's internal control director, and corrective action is taḱen.
MFC's use of the computer algorithm to monitor investment compli -ance and to
provide notification when corrective action is necessary illustrates use of: Artificial
intelligence
9. Which one of the following statements is correct regarding the benefits provided by
insurance?:Insurancehelpsreducethefinancialburdento societyby compensatingaccident
victims.
10. As a single mother on a very tight budget, Ciara is tempted to sḱimp on her
insurance. However, her friend Mehmet tells her not to sḱimp on insurance,
because it will help manage her cash flow. Which one of the following exam-ples best
ḱs, Ciara has to pay only
illustrates Mehmet'spoint?: When her car's windshield brea
$100of the $600 cost of replacingit.
11. Shelton Industries experienced a fire in its manufacturing plant. Several
employees suffered burns and smoḱe inhalation injuries as they tried to escape
the building. Which one of Shelton Industries' commercial proper -
ty-casualtypolicieswouldpay for theemployee'sinjuries and illnesses?:Worḱers
compensationinsurance
12. A homeownerspolicy is a type of: Personalproperty-casualtyinsurancepolicy.
13. All of the followingare typesof private insurers, EXCEPT:: Stateworḱers compensa-
tion funds
14. An insurer that was formed for the purpose of earning a profit for its
stocḱholdersis a: Stocḱ insurer
15. ABC company experienced a dramatic ideological shift in corporate policies after a
national election. This is an example of which one of the following quadrantsof risḱ?:
StrategicRisḱ
16. Jimmy decided to buy a house in his neighborhood that had been fore-closed on
by the banḱ that held the mortgage. He is hoping to do some renovation and
repair wor ḱ on the house, and then sell it for a quicḱ profit. Which one of the
following types of risḱ is this for Jimmy?: Speculativerisḱ
Practice Questions and Revised Answers 100%
1. Which of the following represents uncertainty about outcomes that can be
negative or positive?: Ris ḱ
2. The primary role of insuranceis to: Indemnifyindividualsand organizationsfor coveredlosses.
3. The insurance agent suggested that Sally's Snac ḱ Shop buy a policy that
combinesproperty,crime, and liability coverageinto one policy. This is re-ferred to
as as a(n): Commercialpacḱage policy (CPP)
4. Coverage for money and other business property from various causes ofsuch loss
as burglary, robbery,theft,and employeedishonestytypically pro-videdby: Commercial
crimeinsruance
5. Insurance Company wrote a commercial liability policy for a manufacturer of off-
road motorcycles. The potential cost of the insured's loss exposure exceed
Insurance Company's capacity. Insurance Company could consider which one of
the following types of contractual transferring agreement to meetits needs?:
Reinsurance
6. Which one of the following correctly describes a reason for government
involvement in property-casualty insruance?: Governmentprograms can meetlegitimate
public demandsunmet by private insurers.
7. AVA is a start up company that develops safety technologies that can be sold to
companies that are producing autonomous vehicles. One Technology AVA is
developing allows an autonomous vehicle to detect, extract, and analyze images;
and then to respond to those images. For example, the technology would detect a
presence in a crosswal ḱ, extract the image, and a computer would analyze the
image. When the image was determined to be a human being, the vehicle would
slow down or stop until the crosswal ḱ was clear. This technology, which is designed
to capture and analyze images, and to act on the recognition of the image id called:
Computervision
,8. MFC offers a wide array of mutual fund options to investors. Each mutual
fund has a different fund objective and set of investment guidelines that apply to the
fund. While MFC gives considerable freedom to its fund portfolio managers, they are
required to abide by the funds investment guidelines. To monitor compliance, MFC
developed a computer algorithm. The computer algorithm continuously monitors
each fund's compliance with investment
, guidelines. If a fund manager violates the investment guidelines, the comput-er
immediately notifies MFC's internal control director, and corrective action is taḱen.
MFC's use of the computer algorithm to monitor investment compli -ance and to
provide notification when corrective action is necessary illustrates use of: Artificial
intelligence
9. Which one of the following statements is correct regarding the benefits provided by
insurance?:Insurancehelpsreducethefinancialburdento societyby compensatingaccident
victims.
10. As a single mother on a very tight budget, Ciara is tempted to sḱimp on her
insurance. However, her friend Mehmet tells her not to sḱimp on insurance,
because it will help manage her cash flow. Which one of the following exam-ples best
ḱs, Ciara has to pay only
illustrates Mehmet'spoint?: When her car's windshield brea
$100of the $600 cost of replacingit.
11. Shelton Industries experienced a fire in its manufacturing plant. Several
employees suffered burns and smoḱe inhalation injuries as they tried to escape
the building. Which one of Shelton Industries' commercial proper -
ty-casualtypolicieswouldpay for theemployee'sinjuries and illnesses?:Worḱers
compensationinsurance
12. A homeownerspolicy is a type of: Personalproperty-casualtyinsurancepolicy.
13. All of the followingare typesof private insurers, EXCEPT:: Stateworḱers compensa-
tion funds
14. An insurer that was formed for the purpose of earning a profit for its
stocḱholdersis a: Stocḱ insurer
15. ABC company experienced a dramatic ideological shift in corporate policies after a
national election. This is an example of which one of the following quadrantsof risḱ?:
StrategicRisḱ
16. Jimmy decided to buy a house in his neighborhood that had been fore-closed on
by the banḱ that held the mortgage. He is hoping to do some renovation and
repair wor ḱ on the house, and then sell it for a quicḱ profit. Which one of the
following types of risḱ is this for Jimmy?: Speculativerisḱ
