AINS 103 TEST QUESTIONS AND ANSWERS (ALREADY) PASSED!!| LATEST UPDATED 2025/2026 (GRADED A+)
In property insurance, the term "property in transit" refers to which one of the following? ✔️C. Property while being transported by trucks, cars,
buses, trains, airplanes, and ships
Extra expenses are expenses, in addition to ordinary expenses, that an organization incurs to mitigate the effects of a business interruption.
Which one of the following is an example of an extra expense? ✔️B. Cost to rent temporary office space
Radley Contracting Company is installing new signage on the front of a building. George, a passerby walking near the building is injured when a
Radley employee accidentally drops a tool from a crane. George likely has the ability to assert which one the following types of claim? ✔️B.
Premises and operations liability
Which one of the following entities would likely have the greatest completed operations loss exposure? ✔️A. Paul the plumber
A carrier that is prevented by an accident from delivering the cargo aboard its ship may face an exposure called loss of freight, which is ✔️B. The
compensation the carrier receives for transporting cargo.
To be covered under a workers compensation statute, an injury or disease (in most states) must meet which one of the following
requirements? ✔️A. Arise out of employees' job-related injuries and diseases
The unauthorized intrusion into a company's computer network resulting in damage to intellectual property is best classified as which one of
the following types of cyber liability exposures? ✔️D. Intangible property
An email was sent to a company's employees containing a harmful attachment. Several employees opened the attachment which allowed
hackers to obtain customer contact information. This cyber risk loss is ✔️D. Damage to intangible property.
NH Manufacturing insures its building and personal property under the commercial property coverage part of a commercial package policy
(CPP). During a blizzard, a portion of the building's roof collapsed from the weight of snow. The risk manager pulled out the CPP to make sure
that the building was covered for this type of loss. Which one of the following components of the commercial property coverage part would
provide the risk manager with information on the covered perils? ✔️A. Causes of loss form
Which one of the following is one of the covered causes of loss in the commercial property policy Causes of Loss—Basic form? ✔️Vandalism
Billy owns a baseball souvenir store in Cooperstown, NY. He insured his store under a Building and Personal Property Coverage Form (BPP) with
a $275,000 limit and a $1,500 deductible. A large fire in the store caused significant damage amounting to $310,000 in covered damages. How
much would Billy's insurer pay under his BPP? ✔️$275K
Which one of the following statements about Inflation Guard optional coverage of the Building and Personal Property Coverage Form (BPP) is
true? ✔️C. It is automatically increases the limit of insurance by the percentage of annual increase shown in the declarations.
Which one of the following would be covered under the Extra Expense insuring agreement of the Business Income (and Extra Expense)
Coverage Form? ✔️D. Costs to move to a temporary location
Which one of the following would be considered an extra expense under the Business Income (and Extra Expense) Coverage Form of the
commercial package policy? ✔️C. The increased cost of rent at a temporary location
When Sylvester Properties suffered a $500,000 loss of business income, it filed a claim under the Business Income (and Extra Expense)
Coverage Form (BIC) of its commercial package policy. In order for the loss to be covered, the loss of business income must be due to a
necessary suspension in operations caused by a direct physical loss or damage to property at the premises for which BIC is shown in the policy
declarations. Which one of the following is also part of the criteria for the loss to be covered? ✔️C. The loss or damage must be caused by a
covered cause of loss.
Karma Tea Shop (KTS) has three locations in Boston. The business is insured by a commercial package policy with the Business Income (and
Extra Expense) Coverage Form (BIC). The BIC has a $300,000 limit of insurance which applies to all three locations and a 70 percent coinsurance
provision. The business income insurance for KTS is written on a ✔️B. Blanket basis.
Michael is a general liability claims adjuster for Goshen Mutual. He wants to see if an insured has any endorsements that apply to its general
liability policy. Which one of the following sections of the coverage form would provide this information for Michael? ✔️D. Declarations
Under Coverage A of the commercial general liability coverage form (CGL), property damage would include all of the following, EXCEPT: ✔️A.
Infringement of copyright
, Chuckie's chicken distributor researches the benefits of consuming chicken versus consuming beef. In November 2011, Chuckie's publishes a
brochure outlining the potential health hazards of consuming beef and explaining why chicken is a healthier alternative. Chuckie continues to
publish and distribute the same brochure for six months. In March 2012, several beef distributors file a suit against Chuckie's for personal and
advertising injury. Which one of the following exclusions would apply to this claim under Coverage B of Chuckie's Commercial General Liability
Coverage Form (CGL) with a policy period of January 2012 - January 2013? ✔️C. Material published prior to the policy period
The Commercial General Liability (CGL) Coverage B—Personal and Advertising Injury Liability provides coverage for which one of the following?
✔️B. False arrest
The Coverage B—Personal and Advertising Injury Liability of the Commercial General Liability (CGL) Coverage Form parallels the Coverage A
insuring agreement, but personal and advertising injury applies to an ✔️A. Offense arising out of the named insured's business.
Austin cut his finger while working at a jobsite for Walsh Builders. He had to go to a hospital, where he received 5 stitches and a tetanus
vaccine. When he received the hospital bill for $990, Austin made a claim under Coverage C—Medical Payments of Walsh Builders' CGL policy.
Which one of the following reasons would the CGL insurer use for denying Austin's claim? ✔️A. He is entitled to workers compensation benefits.
Lucy, the owner of Lucy's Flower Shop, was delivering a vase of flowers to a customer, Mrs. White. When Mrs. White opened her front door,
her dog ran outside, knocking the flowers from Lucy's hands, and causing the vase to shatter and injure Mrs. White. Although the customer
insisted that she would be fine, Lucy received a medical bill for injuries to Mrs. White two years later. The medical treatment had been received
one week before Lucy received the bill. Lucy explains the situation to her insurer and requests coverage under her Commercial General Liability
Coverage Form (CGL). Which one of the following is correct regarding whether the medical expenses will be covered under Coverage C—
Medical Payments of the CGL? ✔️B. No, because the medical expenses must be incurred and reported to the insurer within one year after the
date of the accident.
An insured keeps his truck in a garage. A deer gets trapped in the garage and, in an attempt to escape, climbs on top of the truck, breaking the
windshield and causing several dents in the hood. The insured's Business Auto Coverage Form (BACF) provides physical damage coverage for
specified causes of loss with a $100 deductible and collision with a $250 deductible. It will cost the insured $750 to replace the broken
windshield and $1,200 to repair the dents. How much, if anything, will the business auto insurer pay for this loss? ✔️$0
JG Painting is insured under a monoline commercial auto policy. The business is located in Pennsylvania, but also does work in New Jersey and
Delaware. Which one of the following would be used to add PIP insurance coverage to an auto policy? ✔️A. Endorsements
Robert, a single father of two, owns a painting business. While driving his insured van on the job, Robert is involved in a serious accident and
spends several days in the hospital. Robert incurs the following expenses.
$4,000 Lost wages$6,000 Payment for a nanny to watch his two children$5,000 Cost to replace the painting equipment he was hauling$30,000
Medical bills
Assuming Robert has adequate limits and a typical personal injury protection (PIP) endorsement to his Business Auto Coverage Form, how
much of the above will be paid by Robert's auto insurer? ✔️$40K PIP will pay all the expenses except for the loss of equipment, which is a
property damage claim.
Employers liability insurance covers an employer against which one of the following? ✔️B. Its liability for an employee's occupational injury or
disease that is not covered by a workers compensation statute
Umbrella liability insurance ✔️C. May cover some claims that are not covered by underlying liability insurance.
Which one of the following statements about excess liability insurance coverage and umbrella liability insurance coverage is most accurate?
✔️C. Umbrella liability policies typically provide primary coverage for certain types of losses not covered by underlying insurance, while excess
liability policies typically do not.
Shelton Industries is insured under a commercial property policy and an equipment breakdown policy. The company has two claims while both
policies are in force. The first claim is for a furnace explosion and the second claim is for an explosion of unfired pressure vessels. Which one of
the following explains how these losses would be covered under the policies? ✔️B. Each loss would be covered under the commercial property
policy only.
Which one of the following is a policy that covers the crime loss exposures of financial institutions such as banks, savings and loan institutions,
and insurance companies? ✔️B. Financial institution bond
Large Manufacturer, Inc. needs to move its expensive three ton piece of equipment that it manufactured from its manufacturing plant to the
buyer's premises some 50 miles away. Which one of the following is the best way to insure this equipment for the move? ✔️C. Purchase trip
transit insurance
In property insurance, the term "property in transit" refers to which one of the following? ✔️C. Property while being transported by trucks, cars,
buses, trains, airplanes, and ships
Extra expenses are expenses, in addition to ordinary expenses, that an organization incurs to mitigate the effects of a business interruption.
Which one of the following is an example of an extra expense? ✔️B. Cost to rent temporary office space
Radley Contracting Company is installing new signage on the front of a building. George, a passerby walking near the building is injured when a
Radley employee accidentally drops a tool from a crane. George likely has the ability to assert which one the following types of claim? ✔️B.
Premises and operations liability
Which one of the following entities would likely have the greatest completed operations loss exposure? ✔️A. Paul the plumber
A carrier that is prevented by an accident from delivering the cargo aboard its ship may face an exposure called loss of freight, which is ✔️B. The
compensation the carrier receives for transporting cargo.
To be covered under a workers compensation statute, an injury or disease (in most states) must meet which one of the following
requirements? ✔️A. Arise out of employees' job-related injuries and diseases
The unauthorized intrusion into a company's computer network resulting in damage to intellectual property is best classified as which one of
the following types of cyber liability exposures? ✔️D. Intangible property
An email was sent to a company's employees containing a harmful attachment. Several employees opened the attachment which allowed
hackers to obtain customer contact information. This cyber risk loss is ✔️D. Damage to intangible property.
NH Manufacturing insures its building and personal property under the commercial property coverage part of a commercial package policy
(CPP). During a blizzard, a portion of the building's roof collapsed from the weight of snow. The risk manager pulled out the CPP to make sure
that the building was covered for this type of loss. Which one of the following components of the commercial property coverage part would
provide the risk manager with information on the covered perils? ✔️A. Causes of loss form
Which one of the following is one of the covered causes of loss in the commercial property policy Causes of Loss—Basic form? ✔️Vandalism
Billy owns a baseball souvenir store in Cooperstown, NY. He insured his store under a Building and Personal Property Coverage Form (BPP) with
a $275,000 limit and a $1,500 deductible. A large fire in the store caused significant damage amounting to $310,000 in covered damages. How
much would Billy's insurer pay under his BPP? ✔️$275K
Which one of the following statements about Inflation Guard optional coverage of the Building and Personal Property Coverage Form (BPP) is
true? ✔️C. It is automatically increases the limit of insurance by the percentage of annual increase shown in the declarations.
Which one of the following would be covered under the Extra Expense insuring agreement of the Business Income (and Extra Expense)
Coverage Form? ✔️D. Costs to move to a temporary location
Which one of the following would be considered an extra expense under the Business Income (and Extra Expense) Coverage Form of the
commercial package policy? ✔️C. The increased cost of rent at a temporary location
When Sylvester Properties suffered a $500,000 loss of business income, it filed a claim under the Business Income (and Extra Expense)
Coverage Form (BIC) of its commercial package policy. In order for the loss to be covered, the loss of business income must be due to a
necessary suspension in operations caused by a direct physical loss or damage to property at the premises for which BIC is shown in the policy
declarations. Which one of the following is also part of the criteria for the loss to be covered? ✔️C. The loss or damage must be caused by a
covered cause of loss.
Karma Tea Shop (KTS) has three locations in Boston. The business is insured by a commercial package policy with the Business Income (and
Extra Expense) Coverage Form (BIC). The BIC has a $300,000 limit of insurance which applies to all three locations and a 70 percent coinsurance
provision. The business income insurance for KTS is written on a ✔️B. Blanket basis.
Michael is a general liability claims adjuster for Goshen Mutual. He wants to see if an insured has any endorsements that apply to its general
liability policy. Which one of the following sections of the coverage form would provide this information for Michael? ✔️D. Declarations
Under Coverage A of the commercial general liability coverage form (CGL), property damage would include all of the following, EXCEPT: ✔️A.
Infringement of copyright
, Chuckie's chicken distributor researches the benefits of consuming chicken versus consuming beef. In November 2011, Chuckie's publishes a
brochure outlining the potential health hazards of consuming beef and explaining why chicken is a healthier alternative. Chuckie continues to
publish and distribute the same brochure for six months. In March 2012, several beef distributors file a suit against Chuckie's for personal and
advertising injury. Which one of the following exclusions would apply to this claim under Coverage B of Chuckie's Commercial General Liability
Coverage Form (CGL) with a policy period of January 2012 - January 2013? ✔️C. Material published prior to the policy period
The Commercial General Liability (CGL) Coverage B—Personal and Advertising Injury Liability provides coverage for which one of the following?
✔️B. False arrest
The Coverage B—Personal and Advertising Injury Liability of the Commercial General Liability (CGL) Coverage Form parallels the Coverage A
insuring agreement, but personal and advertising injury applies to an ✔️A. Offense arising out of the named insured's business.
Austin cut his finger while working at a jobsite for Walsh Builders. He had to go to a hospital, where he received 5 stitches and a tetanus
vaccine. When he received the hospital bill for $990, Austin made a claim under Coverage C—Medical Payments of Walsh Builders' CGL policy.
Which one of the following reasons would the CGL insurer use for denying Austin's claim? ✔️A. He is entitled to workers compensation benefits.
Lucy, the owner of Lucy's Flower Shop, was delivering a vase of flowers to a customer, Mrs. White. When Mrs. White opened her front door,
her dog ran outside, knocking the flowers from Lucy's hands, and causing the vase to shatter and injure Mrs. White. Although the customer
insisted that she would be fine, Lucy received a medical bill for injuries to Mrs. White two years later. The medical treatment had been received
one week before Lucy received the bill. Lucy explains the situation to her insurer and requests coverage under her Commercial General Liability
Coverage Form (CGL). Which one of the following is correct regarding whether the medical expenses will be covered under Coverage C—
Medical Payments of the CGL? ✔️B. No, because the medical expenses must be incurred and reported to the insurer within one year after the
date of the accident.
An insured keeps his truck in a garage. A deer gets trapped in the garage and, in an attempt to escape, climbs on top of the truck, breaking the
windshield and causing several dents in the hood. The insured's Business Auto Coverage Form (BACF) provides physical damage coverage for
specified causes of loss with a $100 deductible and collision with a $250 deductible. It will cost the insured $750 to replace the broken
windshield and $1,200 to repair the dents. How much, if anything, will the business auto insurer pay for this loss? ✔️$0
JG Painting is insured under a monoline commercial auto policy. The business is located in Pennsylvania, but also does work in New Jersey and
Delaware. Which one of the following would be used to add PIP insurance coverage to an auto policy? ✔️A. Endorsements
Robert, a single father of two, owns a painting business. While driving his insured van on the job, Robert is involved in a serious accident and
spends several days in the hospital. Robert incurs the following expenses.
$4,000 Lost wages$6,000 Payment for a nanny to watch his two children$5,000 Cost to replace the painting equipment he was hauling$30,000
Medical bills
Assuming Robert has adequate limits and a typical personal injury protection (PIP) endorsement to his Business Auto Coverage Form, how
much of the above will be paid by Robert's auto insurer? ✔️$40K PIP will pay all the expenses except for the loss of equipment, which is a
property damage claim.
Employers liability insurance covers an employer against which one of the following? ✔️B. Its liability for an employee's occupational injury or
disease that is not covered by a workers compensation statute
Umbrella liability insurance ✔️C. May cover some claims that are not covered by underlying liability insurance.
Which one of the following statements about excess liability insurance coverage and umbrella liability insurance coverage is most accurate?
✔️C. Umbrella liability policies typically provide primary coverage for certain types of losses not covered by underlying insurance, while excess
liability policies typically do not.
Shelton Industries is insured under a commercial property policy and an equipment breakdown policy. The company has two claims while both
policies are in force. The first claim is for a furnace explosion and the second claim is for an explosion of unfired pressure vessels. Which one of
the following explains how these losses would be covered under the policies? ✔️B. Each loss would be covered under the commercial property
policy only.
Which one of the following is a policy that covers the crime loss exposures of financial institutions such as banks, savings and loan institutions,
and insurance companies? ✔️B. Financial institution bond
Large Manufacturer, Inc. needs to move its expensive three ton piece of equipment that it manufactured from its manufacturing plant to the
buyer's premises some 50 miles away. Which one of the following is the best way to insure this equipment for the move? ✔️C. Purchase trip
transit insurance
