AINS 101 UPDATED COMPREHENSIVE QUESTIONS
AND ANSWERS RATED A+
✔✔Subrogation - ✔✔the process by which an insurer can, after it has paid a loss under
the policy, recover the amount paid from any party who caused the loss or is otherwise
legally liable for the loss
✔✔Salvage rights - ✔✔the insurer's rights to recover and sell or otherwise dispose of
insured property on which the insurer has paid a total loss or a constructive total loss
✔✔Damages - ✔✔money claimed by, or a monetary award to, a party who has suffered
loss or injury for which another party is legally responsible
✔✔Compensatory damages - ✔✔a payment awarded by a court to reimburse a victim
for actual harm
✔✔Special damages - ✔✔a form of compensatory damages that awards a sum of
money for specific, identifiable expenses associated with the injured person's loss, such
as medical expenses or lost wages
✔✔General damages - ✔✔a monetary award to compensate a victim for losses, such
as pain and suffering that does not involved specific, measurable expenses
✔✔Punitive damages - ✔✔a payment awarded by a court to punish a defendant for a
reckless, malicious or deceitful act to deter similar conduct; the award need not bear
any relation to a party's actual damages
✔✔Loss run - ✔✔a report detaining an insured's history of claims that have occurred
over a specific period, valued as of a specific date
✔✔Producer - ✔✔any of several kinds of insurance personnel who place insurance and
surety business with insurers and who represent either insurers or insureds, or both
, ✔✔Broker - ✔✔an independent producer who represents insurance customers
✔✔Brokerage - ✔✔compensation in the form of a flat fee or a commission that is paid
by the reinsurer to the reinsurance intermediary for services provided
✔✔Risk management - ✔✔the process of making and implementing decisions that will
minimize the adverse effects of accidental losses on an organization
✔✔Fortuitous loss - ✔✔a loss that is accidental and unexpected
✔✔Independent exposures - ✔✔group of many persons purchasing insurance
independently and not affected by the losses of others
✔✔Contract of indemnity - ✔✔a contract in which the insurer agrees, in the event of a
covered loss, to pay an amount directly related to the amount of the loss
✔✔Principle of indemnity - ✔✔the principle that insurance policies should provide a
benefit no greater than the loss suffered by an insured
✔✔Utmost good faith - ✔✔an obligation to act in complete honesty and to disclose all
relevant facts
✔✔Contract of adhesion - ✔✔any contract in which one party must either accept the
agreement as written by the other party or reject it
✔✔Conditional contract - ✔✔a contract that one or more parties must perform only
under certain conditions
✔✔Declarations page - ✔✔an insurance policy information page or pages providing
specific details about the insured and the subject of the insurance
✔✔Insuring agreement - ✔✔a statement in an insurance policy that the insurer will,
under described circumstances, make a loss payment or provide a service
✔✔Condition - ✔✔any provision in an insurance policy that qualifies an otherwise
enforceable promise of the insurer
✔✔Exclusion - ✔✔a policy provision that eliminates coverage for specified exposures
✔✔Risk - ✔✔uncertainty about outcomes, can be negative or positive
✔✔Transferring - ✔✔the act of transferring the financial consequences of unanticipated
events to an insurer
AND ANSWERS RATED A+
✔✔Subrogation - ✔✔the process by which an insurer can, after it has paid a loss under
the policy, recover the amount paid from any party who caused the loss or is otherwise
legally liable for the loss
✔✔Salvage rights - ✔✔the insurer's rights to recover and sell or otherwise dispose of
insured property on which the insurer has paid a total loss or a constructive total loss
✔✔Damages - ✔✔money claimed by, or a monetary award to, a party who has suffered
loss or injury for which another party is legally responsible
✔✔Compensatory damages - ✔✔a payment awarded by a court to reimburse a victim
for actual harm
✔✔Special damages - ✔✔a form of compensatory damages that awards a sum of
money for specific, identifiable expenses associated with the injured person's loss, such
as medical expenses or lost wages
✔✔General damages - ✔✔a monetary award to compensate a victim for losses, such
as pain and suffering that does not involved specific, measurable expenses
✔✔Punitive damages - ✔✔a payment awarded by a court to punish a defendant for a
reckless, malicious or deceitful act to deter similar conduct; the award need not bear
any relation to a party's actual damages
✔✔Loss run - ✔✔a report detaining an insured's history of claims that have occurred
over a specific period, valued as of a specific date
✔✔Producer - ✔✔any of several kinds of insurance personnel who place insurance and
surety business with insurers and who represent either insurers or insureds, or both
, ✔✔Broker - ✔✔an independent producer who represents insurance customers
✔✔Brokerage - ✔✔compensation in the form of a flat fee or a commission that is paid
by the reinsurer to the reinsurance intermediary for services provided
✔✔Risk management - ✔✔the process of making and implementing decisions that will
minimize the adverse effects of accidental losses on an organization
✔✔Fortuitous loss - ✔✔a loss that is accidental and unexpected
✔✔Independent exposures - ✔✔group of many persons purchasing insurance
independently and not affected by the losses of others
✔✔Contract of indemnity - ✔✔a contract in which the insurer agrees, in the event of a
covered loss, to pay an amount directly related to the amount of the loss
✔✔Principle of indemnity - ✔✔the principle that insurance policies should provide a
benefit no greater than the loss suffered by an insured
✔✔Utmost good faith - ✔✔an obligation to act in complete honesty and to disclose all
relevant facts
✔✔Contract of adhesion - ✔✔any contract in which one party must either accept the
agreement as written by the other party or reject it
✔✔Conditional contract - ✔✔a contract that one or more parties must perform only
under certain conditions
✔✔Declarations page - ✔✔an insurance policy information page or pages providing
specific details about the insured and the subject of the insurance
✔✔Insuring agreement - ✔✔a statement in an insurance policy that the insurer will,
under described circumstances, make a loss payment or provide a service
✔✔Condition - ✔✔any provision in an insurance policy that qualifies an otherwise
enforceable promise of the insurer
✔✔Exclusion - ✔✔a policy provision that eliminates coverage for specified exposures
✔✔Risk - ✔✔uncertainty about outcomes, can be negative or positive
✔✔Transferring - ✔✔the act of transferring the financial consequences of unanticipated
events to an insurer
