AINS 103
AINS103 Exam Practice Questions and Answers
Graded A+ 2025
In property insurance, the term "Property in Transit" refers to which one of the
following? -Correct Answer ✔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? -Correct Answer ✔Cost to rent temporary
office space.
Upon entering a restaurant, a customer grasped a handrail the broke off, causing
the customer to fall and break his wrist. This is an example of which one of the
following types of commercial general liability loss? -Correct Answer ✔Premises
and operations liability.
A contractor is hired to install a new concrete sidewalk in front of a store. Several
weeks after the sidewalk was installed, the concrete buckles and a passerby trips
and falls on the buckled sidewalk. The passerby sues the contractor to recover
medical expenses incurred due to the fall. This commercial liability is categorized
as -Correct Answer ✔Completed operations liability.
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 -Correct Answer ✔The
compensation the carrier receives for transporting cargo.
The management of Maryland Marine Co. (MMC) must ensure that proper
coverage is obtained for work- related injuries. The employee population of MMC
is a mixture of full-time and part-time employees as well as some casual
employees for one-time tasks. Much of MMC's work is done by independent
contractors and temporary employees during peak seasons. Which one of the
following statements about these persons is true? -Correct Answer ✔Many states
workers compensation statutes exclude casual labor (temporary employees).
When a clothing manufacturer decides to expand the sale of its clothing line by
offering internet purchases, it creates new exposures not otherwise covered, or not
AINS 103
,AINS 103
fully covered, by a traditional policy. These include -Correct Answer ✔Loss or
damage caused by computer virsuses.
Meat Products Company (MPC) runs packing plants in three Midwest states. The
company was in the news recently because of its labor practices. The Department
of Labor (DOL) investigated complaints from five female employees that MPC
discriminated against them. The DOL found the claim was true. The Immigration
and Naturalization Service (INS) found that the company employed illegal
immigrants and paid them less than the minimum wage. When this news became
public, MPC's reputation was severely harmed. This scenario illustrates which
source of reputation risk -Correct Answer ✔Regulatory and legal compliance.
Perils are an important aspect of property insurance. Which one of the following
statements is correct with respect to perils? -Correct Answer ✔A peril is the actual
means by which property is damaged or destroyed such as fire, lightning,
windstorm, hail or theft.
During a business interruption, some of the organizations expenses, called
continuing expenses, will continue, and other expenses, called non-continuing
expenses, will not continue. Which one of the following is an example of a
continuing expense? -Correct Answer ✔Payroll of key employees.
Which one of the following loss exposure exist when a business can be held legally
liable for bodily injury or property damaged caused by their repair or contracting
work? -Correct Answer ✔Completed operations liability.
Which one of the following entities would likely have the greatest completed
operations loss exposure? -Correct Answer ✔Paul the plumber.
Inland marine insurance is insurance that covers -Correct Answer ✔Many different
classes of property that typically involve an element of transportation on land.
Joe signs a contract with Home Builders to install the electrical wiring for a new
home. He uses his own tools and follows the specifications in the contract. Joe is
burned while installing the wiring. Does Home Builders' workers compensation
policy cover Joe's injury? -Correct Answer ✔No, because Joe is not an employee
of Home Builders.
AINS 103
,AINS 103
Cyber risk intellectual property loss exposures include -Correct Answer ✔Cyber
extortion of trade secrets.
As part of its assessment of its cyber risk, an organization should consider whether
there are any intangible property exposures. Which one of the following would
best be classified as an intangible property loss? -Correct Answer ✔The computer
system is hacked and data including credit card numbers are stolen.
Property insurance policies use the term "personal property" to refer to the -Correct
Answer ✔Contents in and around a building.
In business income insurance, the expenses that an organization would not have
incurred if the business interruption have not occurred are called -Correct Answer
✔Extra expenses.
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? -Correct Answer ✔Premises and operations
liability.
John purchased a new lawnmower two years ago. After significant use, the
lawnmower needed servicing. A repairman sharpened the blade but he failed to
reattach it properly to the lawnmower. When John was using the lawnmower, the
blade flew off and seriously injured John's daughter. From the standpoint of a
commercial liability loss for the repair shop, this is an example of -Correct Answer
✔Completed operations liability.
Automobile liability exposures can result from -Correct Answer ✔Hiring or
borrowing an automobile.
Workers compensation benefits include which one of the following? -Correct
Answer ✔Rehabilitation Benefits.
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? -Correct Answer ✔Intangible property.
AINS 103
, AINS 103
An email was sent to a company's employee containing a harmful attachment.
Several employees opened the attachment which allowed hackers to obtain
customer contact information. This cyber risk loss is -Correct Answer ✔Damage to
intangible property.
Which one of the following best describes real property? -Correct Answer
✔Tangible property that include land, structures permanently attached to the land,
and whatever is growing on the land.
Which one of the following is an example of injury or damage arising from an
occurrence that would be covered by the products and completed operations
liability portion of the Commercial General Liability (CGL) Coverage Form? -
Correct Answer ✔A defective gas range manufactured by the insured explodes
causing injury.
A building contractor uses lower grade materials than called for in the
specifications for an office building. A year after the building was completed, a
balcony collapses, injuring several employees and customers and causing damage
to the building and contents. For the building construction company, this is an
example of -Correct Answer ✔A completed operations liability exposure.
To be covered under a workers compensation statute, an injury or disease (in most
states) must meet which one of the following requirements? -Correct Answer
✔Arise out of employees job-related injuries and diseases.
Which one of the following supply chain exposures can a business mitigate by
carefully wording contracts and diversifying suppliers? -Correct Answer ✔Loss of
supply due to external events.
Bio-Pharma was a highly regarded pharmaceutical company. That changed last
year when it was revealed that Bio-Pharma researchers had fabricated test results
of the company's new hypertension drug, a company official bribed a key regulator
to get the drug approved. These revelations led to a sharp decline in sales of all
Bio-Pharma's drugs, a sharp decline in net income, and a decline in Bio-Pharma's
stock price. This scenario clearly indicates the value of a corporation's -Correct
Answer ✔Reputation.
Sally is a commercial property claims adjuster. When she first assigned a claim,
she reviews the commercial property part of the policy to make sure that the
AINS 103
AINS103 Exam Practice Questions and Answers
Graded A+ 2025
In property insurance, the term "Property in Transit" refers to which one of the
following? -Correct Answer ✔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? -Correct Answer ✔Cost to rent temporary
office space.
Upon entering a restaurant, a customer grasped a handrail the broke off, causing
the customer to fall and break his wrist. This is an example of which one of the
following types of commercial general liability loss? -Correct Answer ✔Premises
and operations liability.
A contractor is hired to install a new concrete sidewalk in front of a store. Several
weeks after the sidewalk was installed, the concrete buckles and a passerby trips
and falls on the buckled sidewalk. The passerby sues the contractor to recover
medical expenses incurred due to the fall. This commercial liability is categorized
as -Correct Answer ✔Completed operations liability.
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 -Correct Answer ✔The
compensation the carrier receives for transporting cargo.
The management of Maryland Marine Co. (MMC) must ensure that proper
coverage is obtained for work- related injuries. The employee population of MMC
is a mixture of full-time and part-time employees as well as some casual
employees for one-time tasks. Much of MMC's work is done by independent
contractors and temporary employees during peak seasons. Which one of the
following statements about these persons is true? -Correct Answer ✔Many states
workers compensation statutes exclude casual labor (temporary employees).
When a clothing manufacturer decides to expand the sale of its clothing line by
offering internet purchases, it creates new exposures not otherwise covered, or not
AINS 103
,AINS 103
fully covered, by a traditional policy. These include -Correct Answer ✔Loss or
damage caused by computer virsuses.
Meat Products Company (MPC) runs packing plants in three Midwest states. The
company was in the news recently because of its labor practices. The Department
of Labor (DOL) investigated complaints from five female employees that MPC
discriminated against them. The DOL found the claim was true. The Immigration
and Naturalization Service (INS) found that the company employed illegal
immigrants and paid them less than the minimum wage. When this news became
public, MPC's reputation was severely harmed. This scenario illustrates which
source of reputation risk -Correct Answer ✔Regulatory and legal compliance.
Perils are an important aspect of property insurance. Which one of the following
statements is correct with respect to perils? -Correct Answer ✔A peril is the actual
means by which property is damaged or destroyed such as fire, lightning,
windstorm, hail or theft.
During a business interruption, some of the organizations expenses, called
continuing expenses, will continue, and other expenses, called non-continuing
expenses, will not continue. Which one of the following is an example of a
continuing expense? -Correct Answer ✔Payroll of key employees.
Which one of the following loss exposure exist when a business can be held legally
liable for bodily injury or property damaged caused by their repair or contracting
work? -Correct Answer ✔Completed operations liability.
Which one of the following entities would likely have the greatest completed
operations loss exposure? -Correct Answer ✔Paul the plumber.
Inland marine insurance is insurance that covers -Correct Answer ✔Many different
classes of property that typically involve an element of transportation on land.
Joe signs a contract with Home Builders to install the electrical wiring for a new
home. He uses his own tools and follows the specifications in the contract. Joe is
burned while installing the wiring. Does Home Builders' workers compensation
policy cover Joe's injury? -Correct Answer ✔No, because Joe is not an employee
of Home Builders.
AINS 103
,AINS 103
Cyber risk intellectual property loss exposures include -Correct Answer ✔Cyber
extortion of trade secrets.
As part of its assessment of its cyber risk, an organization should consider whether
there are any intangible property exposures. Which one of the following would
best be classified as an intangible property loss? -Correct Answer ✔The computer
system is hacked and data including credit card numbers are stolen.
Property insurance policies use the term "personal property" to refer to the -Correct
Answer ✔Contents in and around a building.
In business income insurance, the expenses that an organization would not have
incurred if the business interruption have not occurred are called -Correct Answer
✔Extra expenses.
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? -Correct Answer ✔Premises and operations
liability.
John purchased a new lawnmower two years ago. After significant use, the
lawnmower needed servicing. A repairman sharpened the blade but he failed to
reattach it properly to the lawnmower. When John was using the lawnmower, the
blade flew off and seriously injured John's daughter. From the standpoint of a
commercial liability loss for the repair shop, this is an example of -Correct Answer
✔Completed operations liability.
Automobile liability exposures can result from -Correct Answer ✔Hiring or
borrowing an automobile.
Workers compensation benefits include which one of the following? -Correct
Answer ✔Rehabilitation Benefits.
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? -Correct Answer ✔Intangible property.
AINS 103
, AINS 103
An email was sent to a company's employee containing a harmful attachment.
Several employees opened the attachment which allowed hackers to obtain
customer contact information. This cyber risk loss is -Correct Answer ✔Damage to
intangible property.
Which one of the following best describes real property? -Correct Answer
✔Tangible property that include land, structures permanently attached to the land,
and whatever is growing on the land.
Which one of the following is an example of injury or damage arising from an
occurrence that would be covered by the products and completed operations
liability portion of the Commercial General Liability (CGL) Coverage Form? -
Correct Answer ✔A defective gas range manufactured by the insured explodes
causing injury.
A building contractor uses lower grade materials than called for in the
specifications for an office building. A year after the building was completed, a
balcony collapses, injuring several employees and customers and causing damage
to the building and contents. For the building construction company, this is an
example of -Correct Answer ✔A completed operations liability exposure.
To be covered under a workers compensation statute, an injury or disease (in most
states) must meet which one of the following requirements? -Correct Answer
✔Arise out of employees job-related injuries and diseases.
Which one of the following supply chain exposures can a business mitigate by
carefully wording contracts and diversifying suppliers? -Correct Answer ✔Loss of
supply due to external events.
Bio-Pharma was a highly regarded pharmaceutical company. That changed last
year when it was revealed that Bio-Pharma researchers had fabricated test results
of the company's new hypertension drug, a company official bribed a key regulator
to get the drug approved. These revelations led to a sharp decline in sales of all
Bio-Pharma's drugs, a sharp decline in net income, and a decline in Bio-Pharma's
stock price. This scenario clearly indicates the value of a corporation's -Correct
Answer ✔Reputation.
Sally is a commercial property claims adjuster. When she first assigned a claim,
she reviews the commercial property part of the policy to make sure that the
AINS 103
