AIC 300 Exam 2026/2027 – Complete
Questions & Answers
Indemnify - correct answer-To restore a party who has sustained a loss to the
same financial position that party held before the loss occurred.
Third-party administrator (TPA) - correct answer-An organization that provides
administrative services associated with risk financing and insurance.
Claims representative - correct answer-A person responsible for investigating,
evaluating, and settling claims.
Public adjuster - correct answer-An outside organization or person hired by an
insured to represent the insured in a claim in exchange for a fee.
Premium audit - correct answer-Methodical examination of a policyholder's
operations, records, and books of account to determine the actual exposure units
and premium for insurance coverages already provided.
Quantitative Audit Factors - correct answer-Timeliness of reports, reserving and
payments
Qualitative Audit Factors - correct answer-Realistic reserving, accurate evaluation
of insured's liability and follow-up on subrogation opportunity
,Loss ratio - correct answer-A ratio that measures losses and loss adjustment
expenses against earned premiums and that reflects the percentage of premiums
being consumed by losses.
Loss adjustment expense (LAE) - correct answer-The expense that an insurer
incurs to investigate, defend, and settle claims according to the terms specified in
the insurance policy.
Aaron works for a multi-line insurer. He works with insurance producers and
applicants to evaluate new business submissions and conduct renewal
underwriting. Aaron is a
A. Personal lines underwriter.
B. Line underwriter.
C. Staff underwriter.
D. Public underwriter. - correct answer-B. Line underwriter.
This describes the duties of a line underwriter, rather than a staff underwriter.
There is not enough information to determine which line of business is being
written. A public underwriter does not exist. Line underwriters evaluate new
submissions and perform renewal underwriting, usually by working directly with
insurance producers and applicants. Staff underwriters, meanwhile, manage risk
selection by working with line underwriters and coordinating decisions about
products, pricing and guidelines.
Hugo is conducting an audit of a branch office claims operation. He is evaluating
timeliness of reports, number of files opened, proper releases taken, and
accuracy of data entry. Which one of Hugo's metrics is a qualitative audit factor?
,A. Number of files opened
B. Timeliness of reports
C. Accuracy of data entry
D. Proper releases taken - correct answer-D. Proper releases taken
Which one of the following statements regarding third-party administrators
(TPAs) is most accurate?
A. TPAs handle claims, keep claims records, and perform statistical analyses.
B. TPAs are generally found in an insurer's claims department.
C. TPAs are typically used by businesses that have chosen not to self-insure.
D. TPAs are employed only by independent adjusting firms. - correct answer-A.
TPAs handle claims, keep claims records, and perform statistical analyses.
Steps of Making an Initial Claims Assessment - correct answer-Acknowledging and
Assigning the Claim
Identifying the Policy
Contacting the Insured or the Insured's Representative
How do recorded statements and examinations under oath differ? - correct
answer-An examination under oath is more formal than a recorded statement.
Recorded statements are often taken by claims representatives, typically by
telephone. Examinations under oath are usually performed by an attorney for the
insurer at the insurer's office or a court reporter's office.
, Effective statements exhibit these qualities: - correct answer-Coherence—The
statement follows a logical sequence.
Completeness—The statement is thorough.
Objectivity—The statement contains facts relevant to the loss expressed in the
interviewee's own words.
Seven-Part Method - correct answer-1. Permission and introduction—date, time,
and location of the interview, names of the parties involved in the interview, and
an affirmation from the interviewee that the interview is given with permission
2. Identification—identifying information about the person being interviewed,
such as name, address, phone number, and driver's license number
3. Setting—answers to questions such as who was involved in the loss, what was
involved in the loss, when the loss occurred, where the loss occurred, and why
the loss occurred
4. Incident—a step-by-step description of how the loss occurred
5. Post incident injuries/damages—description of the property damage and bodily
injuries to individuals
6. Miscellaneous—any information the interviewee wants to add
7. Conclusion—reaffirmation that the statement was taken with permission
Questions & Answers
Indemnify - correct answer-To restore a party who has sustained a loss to the
same financial position that party held before the loss occurred.
Third-party administrator (TPA) - correct answer-An organization that provides
administrative services associated with risk financing and insurance.
Claims representative - correct answer-A person responsible for investigating,
evaluating, and settling claims.
Public adjuster - correct answer-An outside organization or person hired by an
insured to represent the insured in a claim in exchange for a fee.
Premium audit - correct answer-Methodical examination of a policyholder's
operations, records, and books of account to determine the actual exposure units
and premium for insurance coverages already provided.
Quantitative Audit Factors - correct answer-Timeliness of reports, reserving and
payments
Qualitative Audit Factors - correct answer-Realistic reserving, accurate evaluation
of insured's liability and follow-up on subrogation opportunity
,Loss ratio - correct answer-A ratio that measures losses and loss adjustment
expenses against earned premiums and that reflects the percentage of premiums
being consumed by losses.
Loss adjustment expense (LAE) - correct answer-The expense that an insurer
incurs to investigate, defend, and settle claims according to the terms specified in
the insurance policy.
Aaron works for a multi-line insurer. He works with insurance producers and
applicants to evaluate new business submissions and conduct renewal
underwriting. Aaron is a
A. Personal lines underwriter.
B. Line underwriter.
C. Staff underwriter.
D. Public underwriter. - correct answer-B. Line underwriter.
This describes the duties of a line underwriter, rather than a staff underwriter.
There is not enough information to determine which line of business is being
written. A public underwriter does not exist. Line underwriters evaluate new
submissions and perform renewal underwriting, usually by working directly with
insurance producers and applicants. Staff underwriters, meanwhile, manage risk
selection by working with line underwriters and coordinating decisions about
products, pricing and guidelines.
Hugo is conducting an audit of a branch office claims operation. He is evaluating
timeliness of reports, number of files opened, proper releases taken, and
accuracy of data entry. Which one of Hugo's metrics is a qualitative audit factor?
,A. Number of files opened
B. Timeliness of reports
C. Accuracy of data entry
D. Proper releases taken - correct answer-D. Proper releases taken
Which one of the following statements regarding third-party administrators
(TPAs) is most accurate?
A. TPAs handle claims, keep claims records, and perform statistical analyses.
B. TPAs are generally found in an insurer's claims department.
C. TPAs are typically used by businesses that have chosen not to self-insure.
D. TPAs are employed only by independent adjusting firms. - correct answer-A.
TPAs handle claims, keep claims records, and perform statistical analyses.
Steps of Making an Initial Claims Assessment - correct answer-Acknowledging and
Assigning the Claim
Identifying the Policy
Contacting the Insured or the Insured's Representative
How do recorded statements and examinations under oath differ? - correct
answer-An examination under oath is more formal than a recorded statement.
Recorded statements are often taken by claims representatives, typically by
telephone. Examinations under oath are usually performed by an attorney for the
insurer at the insurer's office or a court reporter's office.
, Effective statements exhibit these qualities: - correct answer-Coherence—The
statement follows a logical sequence.
Completeness—The statement is thorough.
Objectivity—The statement contains facts relevant to the loss expressed in the
interviewee's own words.
Seven-Part Method - correct answer-1. Permission and introduction—date, time,
and location of the interview, names of the parties involved in the interview, and
an affirmation from the interviewee that the interview is given with permission
2. Identification—identifying information about the person being interviewed,
such as name, address, phone number, and driver's license number
3. Setting—answers to questions such as who was involved in the loss, what was
involved in the loss, when the loss occurred, where the loss occurred, and why
the loss occurred
4. Incident—a step-by-step description of how the loss occurred
5. Post incident injuries/damages—description of the property damage and bodily
injuries to individuals
6. Miscellaneous—any information the interviewee wants to add
7. Conclusion—reaffirmation that the statement was taken with permission
