AU 60 - Chpt 3 Key items UPDATED
ACTUAL Questions and CORRECT
Answers
Essential info - CORRECT ANSWER - info that is absolutely necessary to arrive at the
decision
Desirable info - CORRECT ANSWER - info that is not absolutely necessary but would
help in evaluating the account if the info can be obtained at an acceptable cost & w/out any delay
Available info - CORRECT ANSWER - info that may/may not be helpful & is not worth
making any special effort to obtain
Predictive analytics - CORRECT ANSWER - a technology tool that can assist UWs in
decision making. Predictive models use past data to predict future results & can assist UWs in
making decisions more quickly & efficiently. Can help UWs determine which info wouls be
essential before making an UW decision
Information efficiency refers to - CORRECT ANSWER - How the value of the
information to underwriting decisions must be weighed relative to its expense and its timeliness.
An underwriter has been asked to review a commercial package application for a four-story
apartment building. Which one of the following pieces of information would the underwriter
consider essential? - CORRECT ANSWER - Building construction
From an underwriting perspective, most of the information that is requested on a commercial
application would be considered - CORRECT ANSWER - Essential.
Which one of the following should provide an underwriter with most of the essential information
needed to arrive at a decision on a new business applicant? - CORRECT ANSWER -
Application
, Laura is reviewing a commercial auto application for a company that owns a large fleet of local
delivery trucks. Which one of the following pieces of underwriting information would be
desirable, but not essential? - CORRECT ANSWER - Motor vehicle reports on drivers
2 of the most significant items of UW info indicated on the app are - CORRECT
ANSWER - loss history & prior insurance
UWs rely more on - CORRECT ANSWER - producers than any other source for info
about the account
an UW might want additional info for any of these reasons - CORRECT ANSWER - 1. to
collect any missing info. 2. to investigate conflicting info. 3. to verify the accuracy of the info
provided. 4. to handle complex accounts or ones hat present a high degree of risk
the insured can control the - CORRECT ANSWER - frequency of claims
initial sources of UW info - CORRECT ANSWER - 1. producer. 2. application. 3. loss
history. 4. prior insurance.
Which one of the following is an example of a producer acting as a front line underwriter? -
CORRECT ANSWER - A producer decides not to proceed with a prospective client after
seeing the operations.
If an account is experienced rated, for which of the following reasons might an underwriter have
to contact the prior carrier? - CORRECT ANSWER - To confirm or update the loss history
provided by the insured
Which of the following statements regarding the role of the producer in underwriting an account
is (are) true? - CORRECT ANSWER - All of the above (With first-hand knowledge of the
account, the producer can answer many questions for the underwriter. The extent of the
producer's familiarity with the prospect influences the credibility of the information on the
ACTUAL Questions and CORRECT
Answers
Essential info - CORRECT ANSWER - info that is absolutely necessary to arrive at the
decision
Desirable info - CORRECT ANSWER - info that is not absolutely necessary but would
help in evaluating the account if the info can be obtained at an acceptable cost & w/out any delay
Available info - CORRECT ANSWER - info that may/may not be helpful & is not worth
making any special effort to obtain
Predictive analytics - CORRECT ANSWER - a technology tool that can assist UWs in
decision making. Predictive models use past data to predict future results & can assist UWs in
making decisions more quickly & efficiently. Can help UWs determine which info wouls be
essential before making an UW decision
Information efficiency refers to - CORRECT ANSWER - How the value of the
information to underwriting decisions must be weighed relative to its expense and its timeliness.
An underwriter has been asked to review a commercial package application for a four-story
apartment building. Which one of the following pieces of information would the underwriter
consider essential? - CORRECT ANSWER - Building construction
From an underwriting perspective, most of the information that is requested on a commercial
application would be considered - CORRECT ANSWER - Essential.
Which one of the following should provide an underwriter with most of the essential information
needed to arrive at a decision on a new business applicant? - CORRECT ANSWER -
Application
, Laura is reviewing a commercial auto application for a company that owns a large fleet of local
delivery trucks. Which one of the following pieces of underwriting information would be
desirable, but not essential? - CORRECT ANSWER - Motor vehicle reports on drivers
2 of the most significant items of UW info indicated on the app are - CORRECT
ANSWER - loss history & prior insurance
UWs rely more on - CORRECT ANSWER - producers than any other source for info
about the account
an UW might want additional info for any of these reasons - CORRECT ANSWER - 1. to
collect any missing info. 2. to investigate conflicting info. 3. to verify the accuracy of the info
provided. 4. to handle complex accounts or ones hat present a high degree of risk
the insured can control the - CORRECT ANSWER - frequency of claims
initial sources of UW info - CORRECT ANSWER - 1. producer. 2. application. 3. loss
history. 4. prior insurance.
Which one of the following is an example of a producer acting as a front line underwriter? -
CORRECT ANSWER - A producer decides not to proceed with a prospective client after
seeing the operations.
If an account is experienced rated, for which of the following reasons might an underwriter have
to contact the prior carrier? - CORRECT ANSWER - To confirm or update the loss history
provided by the insured
Which of the following statements regarding the role of the producer in underwriting an account
is (are) true? - CORRECT ANSWER - All of the above (With first-hand knowledge of the
account, the producer can answer many questions for the underwriter. The extent of the
producer's familiarity with the prospect influences the credibility of the information on the
