11/5/25, 1:04 PM CPCU 551 - Chapter 1 EXAM (updated 2025) Questions & Answers | Latest Already Graded A+ UPDATE 2025|2026 Flashcards | …
CPCU 551 - Chapter 1 EXAM (updated 2025)
Questions & Answers | Latest Already Graded A+
UPDATE 2025|2026
Save
Terms in this set (78)
abandons or avoids the loss situation, thus eliminating
Exposure avoidance
all possibility of loss
occurs when a firm avoids ever incurring a particular
Proactive avoidance
loss exposure
occurs when a firm eliminates an existing loss
Abandonment
exposure
Loss prevention reduces loss frequency
Loss reduction reduces loss severity
Separation disperses resources over two or more locations
creates copies or spares of important items and stores
Duplication
them at separate locations
spreads loss exposures over several projects,
Diversification
products, markets, and/or regions
generates funds from within the firm to pay for losses;
Retention
compare transfer
generates funds from outside the firm to pay for
Transfer losses, through either insurance or noninsurance
transfer; compare retention
https://quizlet.com/1103662409/cpcu-551-chapter-1-exam-updated-2025-questions-answers-latest-already-graded-a-update-20252026-flash-cards/?… 1/11
, 11/5/25, 1:04 PM CPCU 551 - Chapter 1 EXAM (updated 2025) Questions & Answers | Latest Already Graded A+ UPDATE 2025|2026 Flashcards | …
Burglary theft with forcible entry
Robbery theft by threat or use of bodily violence
theft committed by an employee against his
Employee theft
employer.
Commercial property covers property loss exposures for businesses and
insurance nonprofit organizations
Multiline policy covers two or more lines of business
developed by the Insurance Services Office, Inc., the
Standard form American Association of Insurance Services, or
another insurance advisory organization
Nonstandard form developed independently by insurers or brokers
Commercial package a multiline policy with two or more ISO commercial
policy (CPP) lines coverage parts
CPP abbreviates commercial package policy
A policy that combines, in one form and associated
endorsements, all or most of the commercial property
Output policy
coverages that the insured organization needs, and
uses a flexible rating plan.
a freestanding package policy that provides property
Businessowners' policy
and liability coverages for small to medium sized
(BOP)
businesses
Typically provide building Businessowners' policy
and business personal
property coverage, and
the equivalent of
commercial general
liability coverage
Commercial property applicable to all commercial property coverage forms
conditions under a CPP
any provision that qualifies an otherwise enforceable
Policy condition
promise in an insurance policy
https://quizlet.com/1103662409/cpcu-551-chapter-1-exam-updated-2025-questions-answers-latest-already-graded-a-update-20252026-flash-cards/?… 2/11
CPCU 551 - Chapter 1 EXAM (updated 2025)
Questions & Answers | Latest Already Graded A+
UPDATE 2025|2026
Save
Terms in this set (78)
abandons or avoids the loss situation, thus eliminating
Exposure avoidance
all possibility of loss
occurs when a firm avoids ever incurring a particular
Proactive avoidance
loss exposure
occurs when a firm eliminates an existing loss
Abandonment
exposure
Loss prevention reduces loss frequency
Loss reduction reduces loss severity
Separation disperses resources over two or more locations
creates copies or spares of important items and stores
Duplication
them at separate locations
spreads loss exposures over several projects,
Diversification
products, markets, and/or regions
generates funds from within the firm to pay for losses;
Retention
compare transfer
generates funds from outside the firm to pay for
Transfer losses, through either insurance or noninsurance
transfer; compare retention
https://quizlet.com/1103662409/cpcu-551-chapter-1-exam-updated-2025-questions-answers-latest-already-graded-a-update-20252026-flash-cards/?… 1/11
, 11/5/25, 1:04 PM CPCU 551 - Chapter 1 EXAM (updated 2025) Questions & Answers | Latest Already Graded A+ UPDATE 2025|2026 Flashcards | …
Burglary theft with forcible entry
Robbery theft by threat or use of bodily violence
theft committed by an employee against his
Employee theft
employer.
Commercial property covers property loss exposures for businesses and
insurance nonprofit organizations
Multiline policy covers two or more lines of business
developed by the Insurance Services Office, Inc., the
Standard form American Association of Insurance Services, or
another insurance advisory organization
Nonstandard form developed independently by insurers or brokers
Commercial package a multiline policy with two or more ISO commercial
policy (CPP) lines coverage parts
CPP abbreviates commercial package policy
A policy that combines, in one form and associated
endorsements, all or most of the commercial property
Output policy
coverages that the insured organization needs, and
uses a flexible rating plan.
a freestanding package policy that provides property
Businessowners' policy
and liability coverages for small to medium sized
(BOP)
businesses
Typically provide building Businessowners' policy
and business personal
property coverage, and
the equivalent of
commercial general
liability coverage
Commercial property applicable to all commercial property coverage forms
conditions under a CPP
any provision that qualifies an otherwise enforceable
Policy condition
promise in an insurance policy
https://quizlet.com/1103662409/cpcu-551-chapter-1-exam-updated-2025-questions-answers-latest-already-graded-a-update-20252026-flash-cards/?… 2/11
