AU 60 FINAL EXAM TEST QS
QUESTIONS & ANSWERS (GRADED
A+)
Samuel is a commercial accounts underwriter working on a new application with five
buildings located within the same territory. Samuel would like a photo of each
building, and some nontechnical information about the condition of the parking lots
and the neighboring buildings. Which one of the following would be the most reliable
and cost effective source of this information? - ANSWERMarketing representative
The principal purpose of underwriting is to - ANSWERDevelop and maintain a
profitable book of business for the insurer.
Which one of the following statements is correct regarding wrap-ups? -
ANSWERActivities covered by the wrap-up program should be excluded from the
participating contractors' primary insurance policies.
Contractors often form which one of the following alternative forms of business
ownership to perform a large construction project? - ANSWERJoint venture
Insurers will sometimes use composite rating when determining the premium on an
account. Which one of the following is true regarding composite rating? -
ANSWERComposite rating is primarily used for its administrative convenience.
All of the following are objectives of rate regulation, EXCEPT: - ANSWERRates
promote availability and affordability of insurance.
Prudence of operations indicates an organization's ability to - ANSWERConduct its
operations within the limits of its capabilities.
All of the following are reasons that an underwriter might want to obtain information
in addition to the application, EXCEPT: - ANSWERTo postpone a decision
Which one of the following is an example of an efficiency ratio? - ANSWERAccounts
receivable turnover ratio
Sarbanes-Oxley prompted the SEC to issue interpretive guidance for improved
disclosure in the management discussion and analysis (MD&A) report of an
organization. Which one of the following is an area of guidance from Sarbanes-
Oxley? - ANSWERDisclosure of certain trading activities
Which one of the following negotiation styles focuses only on short term goals and
does not support the goal of building a long term relationship? - ANSWERCompeting
QUESTIONS & ANSWERS (GRADED
A+)
Samuel is a commercial accounts underwriter working on a new application with five
buildings located within the same territory. Samuel would like a photo of each
building, and some nontechnical information about the condition of the parking lots
and the neighboring buildings. Which one of the following would be the most reliable
and cost effective source of this information? - ANSWERMarketing representative
The principal purpose of underwriting is to - ANSWERDevelop and maintain a
profitable book of business for the insurer.
Which one of the following statements is correct regarding wrap-ups? -
ANSWERActivities covered by the wrap-up program should be excluded from the
participating contractors' primary insurance policies.
Contractors often form which one of the following alternative forms of business
ownership to perform a large construction project? - ANSWERJoint venture
Insurers will sometimes use composite rating when determining the premium on an
account. Which one of the following is true regarding composite rating? -
ANSWERComposite rating is primarily used for its administrative convenience.
All of the following are objectives of rate regulation, EXCEPT: - ANSWERRates
promote availability and affordability of insurance.
Prudence of operations indicates an organization's ability to - ANSWERConduct its
operations within the limits of its capabilities.
All of the following are reasons that an underwriter might want to obtain information
in addition to the application, EXCEPT: - ANSWERTo postpone a decision
Which one of the following is an example of an efficiency ratio? - ANSWERAccounts
receivable turnover ratio
Sarbanes-Oxley prompted the SEC to issue interpretive guidance for improved
disclosure in the management discussion and analysis (MD&A) report of an
organization. Which one of the following is an area of guidance from Sarbanes-
Oxley? - ANSWERDisclosure of certain trading activities
Which one of the following negotiation styles focuses only on short term goals and
does not support the goal of building a long term relationship? - ANSWERCompeting
