AINS 101 112 2026 EXAM REVIEW SOLVED
QUESTIONS AND CORRECT ANSWERS
GRADED A+
◉ Transferring.
Answer: The act of transferring the financial consequences of
unanticipated events to an insurer
◉ Pooling.
Answer: All insureds share the costs of eachothers' losses. Insurers
combine all premiums collected to pay losses as they occur
◉ Personal Insurance (Property).
Answer: Protects an insured's assets by covering the cost of
repairing or replacing property that is damaged, lost, or destroyed.
◉ Personal Insurance (Liability).
Answer: Provides payments for injury to others or damage to other's
property for which the insured is legally responsible. Also covers the
cost to defend the insured against related lawsuits
◉ Personal Insurance (Health).
,Answer: Protects individuals and families from financial losses
caused by sickness or accidents
◉ Personal P&C Insurance (Homeowners).
Answer: Provides protection when people's homes and/or
belongings are damaged or stolen and liability coverage for
situations such as the family dog biting a desk
◉ Personal Auto Insurance.
Answer: If insured is at fault in an accident, provides coverage for
personal bodily injury to another person or damage to another
person's auto. Also provides coverage for damaged to insured auto
(not wear + tear). Legally required
◉ Personal Umbrella Insurance.
Answer: Provides additional protection for people with a high
potential for large liability losses
◉ Commercial Property Insurance.
Answer: Covers damage to buildings or their contents that results
from fire, vandalism, and other causes of loss
◉ Commercial Crime Insurance.
,Answer: Protects against losses from theft of business property and
money, including employee theft
◉ Commercial General Liability.
Answer: Protects a business against its legal liability to others for
bodily injury or property damage
◉ Commercial Auto Insurance.
Answer: Covers liability for bodily injury and property damage
caused by the use of the businesses' autos and also damage to the
business own autos when they are in an accident
◉ Workers Compensation.
Answer: Covers legally required benefits that businesses are
required to pay to their employees for job-related injuries and
illnesses
◉ Commercial Umbrella Insurance.
Answer: Provides additional liability limits beyond those provided
by other commercial policies, protecting a business in the event of
large liability loss
◉ Stock Insurers (Private Insurers).
, Answer: Objective is to earn a profit, and they attract stockholders
by the expectation of investment returns. Many large PC insurers are
this.
◉ Mutual Insurers (Private Insurers).
Answer: Share profits, pay dividends to policyholders as a return of
a portion of premiums paid. Some large insurers and many regional
insurers are this.
◉ Surplus Lines Insurers (Private Insurers).
Answer: Provide insurance coverages unavailable in the standard
market
◉ Reinsurance (Private Insurers).
Answer: Allows a primary insurer to transfer some loss exposures to
another insurer, the reinsurer. It can help a small insurer provide
insurance for large accounts.
◉ What role does the government play in insurance?.
Answer: - If a type of insurance is required, the government makes
sure it is available at a reasonable price
- Reduces time or resources needed to obtain insurance coverage
- Can help find insurance for accounts that private insurers are
unwilling or unable to provide
QUESTIONS AND CORRECT ANSWERS
GRADED A+
◉ Transferring.
Answer: The act of transferring the financial consequences of
unanticipated events to an insurer
◉ Pooling.
Answer: All insureds share the costs of eachothers' losses. Insurers
combine all premiums collected to pay losses as they occur
◉ Personal Insurance (Property).
Answer: Protects an insured's assets by covering the cost of
repairing or replacing property that is damaged, lost, or destroyed.
◉ Personal Insurance (Liability).
Answer: Provides payments for injury to others or damage to other's
property for which the insured is legally responsible. Also covers the
cost to defend the insured against related lawsuits
◉ Personal Insurance (Health).
,Answer: Protects individuals and families from financial losses
caused by sickness or accidents
◉ Personal P&C Insurance (Homeowners).
Answer: Provides protection when people's homes and/or
belongings are damaged or stolen and liability coverage for
situations such as the family dog biting a desk
◉ Personal Auto Insurance.
Answer: If insured is at fault in an accident, provides coverage for
personal bodily injury to another person or damage to another
person's auto. Also provides coverage for damaged to insured auto
(not wear + tear). Legally required
◉ Personal Umbrella Insurance.
Answer: Provides additional protection for people with a high
potential for large liability losses
◉ Commercial Property Insurance.
Answer: Covers damage to buildings or their contents that results
from fire, vandalism, and other causes of loss
◉ Commercial Crime Insurance.
,Answer: Protects against losses from theft of business property and
money, including employee theft
◉ Commercial General Liability.
Answer: Protects a business against its legal liability to others for
bodily injury or property damage
◉ Commercial Auto Insurance.
Answer: Covers liability for bodily injury and property damage
caused by the use of the businesses' autos and also damage to the
business own autos when they are in an accident
◉ Workers Compensation.
Answer: Covers legally required benefits that businesses are
required to pay to their employees for job-related injuries and
illnesses
◉ Commercial Umbrella Insurance.
Answer: Provides additional liability limits beyond those provided
by other commercial policies, protecting a business in the event of
large liability loss
◉ Stock Insurers (Private Insurers).
, Answer: Objective is to earn a profit, and they attract stockholders
by the expectation of investment returns. Many large PC insurers are
this.
◉ Mutual Insurers (Private Insurers).
Answer: Share profits, pay dividends to policyholders as a return of
a portion of premiums paid. Some large insurers and many regional
insurers are this.
◉ Surplus Lines Insurers (Private Insurers).
Answer: Provide insurance coverages unavailable in the standard
market
◉ Reinsurance (Private Insurers).
Answer: Allows a primary insurer to transfer some loss exposures to
another insurer, the reinsurer. It can help a small insurer provide
insurance for large accounts.
◉ What role does the government play in insurance?.
Answer: - If a type of insurance is required, the government makes
sure it is available at a reasonable price
- Reduces time or resources needed to obtain insurance coverage
- Can help find insurance for accounts that private insurers are
unwilling or unable to provide
