AIC 300 EXAM 2025 | ALL QUESTIONS AND CORRECT ANSWERS WIT
AIC 300
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EXAM (JUST RELEASED)
1. Indemnify To restore a party who has sustained a loss to the same
financial position that party held before the loss occurred.
2. Third-party administrator (TPA) An organization that provides administrative services associ-
ated with risk financing and insurance.
3. Claims representative A person responsible for investigating, evaluating, and set-
tling claims.
4. Public adjuster An outside organization or person hired by an insured to
represent the insured in a claim in exchange for a fee.
5. Premium audit Methodical examination of a policyholder's operations,
records, and books of account to determine the actual ex-
posure units and premium for insurance coverages already
provided.
6. Quantitative Audit Factors Timeliness of reports, reserving and payments
7. Qualitative Audit Factors Realistic reserving, accurate evaluation of insured's liability
and follow-up on subrogation opportunity
8. Loss ratio A ratio that measures losses and loss adjustment expenses
against earned premiums and that reflects the percentage
of premiums being consumed by losses.
9. Loss adjustment expense (LAE) The expense that an insurer incurs to investigate, defend,
and settle claims according to the terms specified in the
insurance policy.
10. Aaron works for a multi-line B. Line underwriter.
insurer. He works with insur-
ance producers and applicants This describes the duties of a line underwriter, rather than
to evaluate new business sub- a staff underwriter. There is not enough information to de-
, AIC 300
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missions and conduct renewal termine which line of business is being written. A public
underwriting. Aaron is a underwriter does not exist. Line underwriters evaluate new
submissions and perform renewal underwriting, usually by
A. Personal lines underwriter. working directly with insurance producers and applicants.
B. Line underwriter. Staff underwriters, meanwhile, manage risk selection by
C. Staff underwriter. working with line underwriters and coordinating decisions
D. Public underwriter. about products, pricing and guidelines.
11. Hugo is conducting an audit D. Proper releases taken
of a branch office claims oper-
ation. He is evaluating timeli-
ness of reports, number of files
opened, proper releases tak-
en, 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
12. Which one of the fol- A. TPAs handle claims, keep claims records, and perform
lowing statements regard- statistical analyses.
ing 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 depart-
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ment.
C. TPAs are typically used by
businesses that have chosen
not to self-insure.
D. TPAs are employed only by
independent adjusting firms.
13. Steps of Making an Initial Acknowledging and Assigning the Claim
Claims Assessment Identifying the Policy
Contacting the Insured or the Insured's Representative
14. How do recorded statements An examination under oath is more formal than a recorded
and examinations under oath statement. Recorded statements are often taken by claims
differ? 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.
15. Effective statements exhibit Coherence—The statement follows a logical sequence.
these qualities: Completeness—The statement is thorough.
Objectivity—The statement contains facts relevant to the loss
expressed in the interviewee's own words.
16. Seven-Part Method 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 oc-
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curred, where the loss occurred, and why the loss occurred
4. Incident—a step-by-step description of how the loss oc-
curred
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
17. Reserve The amount the insurer estimates and sets aside to pay on
an existing claim.
18. Individual case method a method of setting reserves based on the claim's circum-
stances and the claim representative's experience in han-
dling similar claims
19. Roundtable method A method of setting reserves by using the consensus of two
or more claim personnel who have independently evaluated
the claim file
20. Average value method A case reserving method that establishes a predetermined
dollar amount of reserve for each claim as it is reported.
21. Formula method A method of setting claim reserves by using a mathematical
formula.
22. Expert system method A method of setting reserves with a software application that
estimates losses and loss adjustment expenses.
AIC 300
(DETAILED ANSWERS) | GRADED A+ | VERIFIED ANSWERS | LATEST
Study online at https://quizlet.com/_hdw84c
EXAM (JUST RELEASED)
1. Indemnify To restore a party who has sustained a loss to the same
financial position that party held before the loss occurred.
2. Third-party administrator (TPA) An organization that provides administrative services associ-
ated with risk financing and insurance.
3. Claims representative A person responsible for investigating, evaluating, and set-
tling claims.
4. Public adjuster An outside organization or person hired by an insured to
represent the insured in a claim in exchange for a fee.
5. Premium audit Methodical examination of a policyholder's operations,
records, and books of account to determine the actual ex-
posure units and premium for insurance coverages already
provided.
6. Quantitative Audit Factors Timeliness of reports, reserving and payments
7. Qualitative Audit Factors Realistic reserving, accurate evaluation of insured's liability
and follow-up on subrogation opportunity
8. Loss ratio A ratio that measures losses and loss adjustment expenses
against earned premiums and that reflects the percentage
of premiums being consumed by losses.
9. Loss adjustment expense (LAE) The expense that an insurer incurs to investigate, defend,
and settle claims according to the terms specified in the
insurance policy.
10. Aaron works for a multi-line B. Line underwriter.
insurer. He works with insur-
ance producers and applicants This describes the duties of a line underwriter, rather than
to evaluate new business sub- a staff underwriter. There is not enough information to de-
, AIC 300
Study online at https://quizlet.com/_hdw84c
missions and conduct renewal termine which line of business is being written. A public
underwriting. Aaron is a underwriter does not exist. Line underwriters evaluate new
submissions and perform renewal underwriting, usually by
A. Personal lines underwriter. working directly with insurance producers and applicants.
B. Line underwriter. Staff underwriters, meanwhile, manage risk selection by
C. Staff underwriter. working with line underwriters and coordinating decisions
D. Public underwriter. about products, pricing and guidelines.
11. Hugo is conducting an audit D. Proper releases taken
of a branch office claims oper-
ation. He is evaluating timeli-
ness of reports, number of files
opened, proper releases tak-
en, 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
12. Which one of the fol- A. TPAs handle claims, keep claims records, and perform
lowing statements regard- statistical analyses.
ing 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 depart-
, AIC 300
Study online at https://quizlet.com/_hdw84c
ment.
C. TPAs are typically used by
businesses that have chosen
not to self-insure.
D. TPAs are employed only by
independent adjusting firms.
13. Steps of Making an Initial Acknowledging and Assigning the Claim
Claims Assessment Identifying the Policy
Contacting the Insured or the Insured's Representative
14. How do recorded statements An examination under oath is more formal than a recorded
and examinations under oath statement. Recorded statements are often taken by claims
differ? 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.
15. Effective statements exhibit Coherence—The statement follows a logical sequence.
these qualities: Completeness—The statement is thorough.
Objectivity—The statement contains facts relevant to the loss
expressed in the interviewee's own words.
16. Seven-Part Method 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 oc-
, AIC 300
Study online at https://quizlet.com/_hdw84c
curred, where the loss occurred, and why the loss occurred
4. Incident—a step-by-step description of how the loss oc-
curred
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
17. Reserve The amount the insurer estimates and sets aside to pay on
an existing claim.
18. Individual case method a method of setting reserves based on the claim's circum-
stances and the claim representative's experience in han-
dling similar claims
19. Roundtable method A method of setting reserves by using the consensus of two
or more claim personnel who have independently evaluated
the claim file
20. Average value method A case reserving method that establishes a predetermined
dollar amount of reserve for each claim as it is reported.
21. Formula method A method of setting claim reserves by using a mathematical
formula.
22. Expert system method A method of setting reserves with a software application that
estimates losses and loss adjustment expenses.
