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AIC 304 Final Actual Exam Newest Actual Exam With Complete
Questions And Correct Detailed Answers (Verified Answers)
|Already Graded A+
Paris Cuisine, a fine-dining restaurant, rents space in a commercial
building, which is insured by its owner. Paris Cuisine spends $50,000
on wallpaper, floor coverings, windows, and other improvements
that would remain in the building if Paris Cuisine were to move out.
Paris Cuisine's interest in these improvements is insured under which
one of the following? - A. The business personal property section of
Paris Cuisine's BPP
B. The leasehold improvements section of the building owner's BPP
C. The property of others section of the building owner's BPP
D. The building portion of Paris Cuisine's Building and Personal
Property Coverage Form (BPP)
ANSWERS-- A
Insureds who want to suspend the coinsurance provision may do so
through A. The BPP's Agreed Value optional coverage.
B. Engaging a reinsurer.
C. Arbitration with the insurer.
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D. The insurance-to-value provision.
- ANSWERS--A
In a property loss, a list of damaged areas with proposed
remediation actions for each area is called - A. A loss plan.
B. A scope.
C. An inventory.
D. A checklist.
ANSWERS--B
Sho is investigating a large merchandise loss for an insured. He has
avoided making commitments that may waive policy conditions,
outlined the claims handling process, learned how the insured
business operates, and inspected the premises and the damaged
merchandise. Which one the following actions by Sho is part of the
preliminary survey? A. Avoided commitments
B. Inspection of premises
C. Outline of the process
D. Learned the operation
- ANSWERS--B
Julio's washing machine malfunctions, flooding his basement. The
appliance is covered by a service agreement, which pays for the
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repairs to the machine itself. Julio's insurer covers the rest of the
loss. This other-insurance method is often called A. The
primary/excess method.
B. The pro-rata method.
C. Contribution by limits.
D. The proportional-share method.
- ANSWERS--A
Jack owns a souvenir shop in a beach resort town, doing most of his
business during the summer months. In considering coverage beyond
his policy limits, which one of the following is most likely to be useful
to Jack? A. Peak season endorsement
B. Increased cost of construction
C. Inflation guard
D. Extended replacement cost coverage
- ANSWERS--A
Luis is handling a claim for property damage in which the insured
maintains that his manufacturing equipment was damage by a power
surge from lightning. He referenced the National Weather Service
and determined that there was a lightning strike in the area on the
date of the loss, but it did not strike the insured property directly.
Luis should A. Deny the claim because the damage was not caused by
a latent defect.
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B. Hire a repair professional to confirm the damage was caused by
lightning.
C. Accept the claim because the property policy covers mechanical
breakdown
D. Deny the claim because the lightning did not strike the insured
property
- ANSWERS--B
Two methods are generally used to determine the amount of
business income lost under business income coverage forms: net
income plus continuing expenses and A. Gross profit plus continuing
expenses.
B. Net profit plus noncontinuing expenses.
C. Net profit plus continuing expenses.
D. Gross profit less noncontinuing expenses.
- ANSWERS--D
When the insurer being subrogated against disputes either the
liability or the amount payable, disputes can be resolved by - A. Non-
binding intercompany arbitration.
B. Binding intercompany arbitration.
C. The state insurance commissioner.
D. Engaging subrogation attorneys.
AIC 304 Final Actual Exam Newest Actual Exam With Complete
Questions And Correct Detailed Answers (Verified Answers)
|Already Graded A+
Paris Cuisine, a fine-dining restaurant, rents space in a commercial
building, which is insured by its owner. Paris Cuisine spends $50,000
on wallpaper, floor coverings, windows, and other improvements
that would remain in the building if Paris Cuisine were to move out.
Paris Cuisine's interest in these improvements is insured under which
one of the following? - A. The business personal property section of
Paris Cuisine's BPP
B. The leasehold improvements section of the building owner's BPP
C. The property of others section of the building owner's BPP
D. The building portion of Paris Cuisine's Building and Personal
Property Coverage Form (BPP)
ANSWERS-- A
Insureds who want to suspend the coinsurance provision may do so
through A. The BPP's Agreed Value optional coverage.
B. Engaging a reinsurer.
C. Arbitration with the insurer.
,2|Page
D. The insurance-to-value provision.
- ANSWERS--A
In a property loss, a list of damaged areas with proposed
remediation actions for each area is called - A. A loss plan.
B. A scope.
C. An inventory.
D. A checklist.
ANSWERS--B
Sho is investigating a large merchandise loss for an insured. He has
avoided making commitments that may waive policy conditions,
outlined the claims handling process, learned how the insured
business operates, and inspected the premises and the damaged
merchandise. Which one the following actions by Sho is part of the
preliminary survey? A. Avoided commitments
B. Inspection of premises
C. Outline of the process
D. Learned the operation
- ANSWERS--B
Julio's washing machine malfunctions, flooding his basement. The
appliance is covered by a service agreement, which pays for the
,3|Page
repairs to the machine itself. Julio's insurer covers the rest of the
loss. This other-insurance method is often called A. The
primary/excess method.
B. The pro-rata method.
C. Contribution by limits.
D. The proportional-share method.
- ANSWERS--A
Jack owns a souvenir shop in a beach resort town, doing most of his
business during the summer months. In considering coverage beyond
his policy limits, which one of the following is most likely to be useful
to Jack? A. Peak season endorsement
B. Increased cost of construction
C. Inflation guard
D. Extended replacement cost coverage
- ANSWERS--A
Luis is handling a claim for property damage in which the insured
maintains that his manufacturing equipment was damage by a power
surge from lightning. He referenced the National Weather Service
and determined that there was a lightning strike in the area on the
date of the loss, but it did not strike the insured property directly.
Luis should A. Deny the claim because the damage was not caused by
a latent defect.
, 4|Page
B. Hire a repair professional to confirm the damage was caused by
lightning.
C. Accept the claim because the property policy covers mechanical
breakdown
D. Deny the claim because the lightning did not strike the insured
property
- ANSWERS--B
Two methods are generally used to determine the amount of
business income lost under business income coverage forms: net
income plus continuing expenses and A. Gross profit plus continuing
expenses.
B. Net profit plus noncontinuing expenses.
C. Net profit plus continuing expenses.
D. Gross profit less noncontinuing expenses.
- ANSWERS--D
When the insurer being subrogated against disputes either the
liability or the amount payable, disputes can be resolved by - A. Non-
binding intercompany arbitration.
B. Binding intercompany arbitration.
C. The state insurance commissioner.
D. Engaging subrogation attorneys.
