ARM 402 Exam Practice Questions and
Answers with Verified Solutions | Latest
Updated 2026
Telematics devices allow A
organizations to accurately
identify patterns of risk and
predict risk for which one of
the following types of loss
exposures? A. Automobile B.
Property C. Workers
compensation D. Business
income
Which one of the following is a C
major benefit that smart
insurance contracts can
provide to insurance
customers? A. Smart contracts
can render a risk completely
preventable. B. Smart
contracts can provide broader
coverage at a lower cost. C.
Smart contracts can
dramatically increase the
speed of loss payments. D.
Smart contracts can
significantly increase the
speed of premium payments.
,Maxwell Company has just A
invested a large sum in new,
highly-sophisticated computer
equipment and building
renovations. Maxwell arranged
to lease identical equipment at
another location so that it
could use the equipment in
the event of a disaster at its
location. Maxwell's lease of
identical equipment at another
location is an example of A.
Duplication. B. Separation. C.
Loss reduction. D.
Diversification.
Olivia is planning a meeting to C
explain a new cyber security
procedure. She expects that
the meeting will be impeded
by hidden agendas. Which one
of the following is the best way
for Olivia to deal with potential
hidden agendas? A. Olivia
should refuse to take
questions during her meeting,
and request that any
questions be forwarded to her
in writing after the meeting. B.
Olivia should start the meeting
by stating that she does not
expect everyone like the new
procedure, but they must
accept it. C. Olivia should start
,the meeting by asking
participants to state their
concerns or feeling about the
procedure. D. Olivia should
hold a separate meeting for
those individuals who she
suspects have a hidden
agenda.
Which one of the following is a C
common problem with
meetings that leaders should
try to avoid? A. Trying to stick
to an agenda and avoid
interruptions B. Committing to
an end time, as well as a start
time C. Having the wrong
people attend D. Stating the
objective in writing before the
meeting
Which one of the following C
statements about correlation
and covariance is true? A.
Covariance is a scaled version
of correlation and ranges from
- 1 to +1. B. The correlation
between variables ranges from
0 to +1. C. Covariance
measures the extent to which
variables move together or
independently. D. Correlation
measures causality.
, Once a holistic risk B
management program is
created and put into effect,
which one of the following
methods can be used to allow
constant and consistent
monitoring of the process? A.
Bow-tie diagram B. Feedback
loop C. Dashboard reporting D.
SWOT analysis
A risk control technique that A
reduces the frequency of a
particular loss is A. Loss
prevention. B. Loss reduction.
C. Diversification. D.
Duplication.
Ivanhoe Corporation C
purchases stock in a bank and
in a pharmaceutical
manufacturer. Because these
are unrelated industries,
Ivanhoe hope that any losses
in one stock will be more than
offset by profits in another.
Ivanhoe is using which one of
the following risk management
techniques? A. Risk transfer B.
Duplication C. Diversification
D. Separation
Pacific Bar and Grill was B
having a problem with
Answers with Verified Solutions | Latest
Updated 2026
Telematics devices allow A
organizations to accurately
identify patterns of risk and
predict risk for which one of
the following types of loss
exposures? A. Automobile B.
Property C. Workers
compensation D. Business
income
Which one of the following is a C
major benefit that smart
insurance contracts can
provide to insurance
customers? A. Smart contracts
can render a risk completely
preventable. B. Smart
contracts can provide broader
coverage at a lower cost. C.
Smart contracts can
dramatically increase the
speed of loss payments. D.
Smart contracts can
significantly increase the
speed of premium payments.
,Maxwell Company has just A
invested a large sum in new,
highly-sophisticated computer
equipment and building
renovations. Maxwell arranged
to lease identical equipment at
another location so that it
could use the equipment in
the event of a disaster at its
location. Maxwell's lease of
identical equipment at another
location is an example of A.
Duplication. B. Separation. C.
Loss reduction. D.
Diversification.
Olivia is planning a meeting to C
explain a new cyber security
procedure. She expects that
the meeting will be impeded
by hidden agendas. Which one
of the following is the best way
for Olivia to deal with potential
hidden agendas? A. Olivia
should refuse to take
questions during her meeting,
and request that any
questions be forwarded to her
in writing after the meeting. B.
Olivia should start the meeting
by stating that she does not
expect everyone like the new
procedure, but they must
accept it. C. Olivia should start
,the meeting by asking
participants to state their
concerns or feeling about the
procedure. D. Olivia should
hold a separate meeting for
those individuals who she
suspects have a hidden
agenda.
Which one of the following is a C
common problem with
meetings that leaders should
try to avoid? A. Trying to stick
to an agenda and avoid
interruptions B. Committing to
an end time, as well as a start
time C. Having the wrong
people attend D. Stating the
objective in writing before the
meeting
Which one of the following C
statements about correlation
and covariance is true? A.
Covariance is a scaled version
of correlation and ranges from
- 1 to +1. B. The correlation
between variables ranges from
0 to +1. C. Covariance
measures the extent to which
variables move together or
independently. D. Correlation
measures causality.
, Once a holistic risk B
management program is
created and put into effect,
which one of the following
methods can be used to allow
constant and consistent
monitoring of the process? A.
Bow-tie diagram B. Feedback
loop C. Dashboard reporting D.
SWOT analysis
A risk control technique that A
reduces the frequency of a
particular loss is A. Loss
prevention. B. Loss reduction.
C. Diversification. D.
Duplication.
Ivanhoe Corporation C
purchases stock in a bank and
in a pharmaceutical
manufacturer. Because these
are unrelated industries,
Ivanhoe hope that any losses
in one stock will be more than
offset by profits in another.
Ivanhoe is using which one of
the following risk management
techniques? A. Risk transfer B.
Duplication C. Diversification
D. Separation
Pacific Bar and Grill was B
having a problem with
