AINS 103 Questions with CORRECT Answers
Question:
Is any condition that presents the possibility that an organization will sustain a loss
resulting from damage or theft of its property.
Answer:
A Commercial Property Loss Exposure is:
Question:
Real Property (Realty):
Answer:
Tangible property consisting of land, all structures permanently attached to the land,
(including fixtures permanently attached) and whatever is growing on the land.
Question:
Personal Property:
Answer:
Includes moveable items owned by a business, such as supplies, furniture, computers,
machinery, tools, and some vehicles, (forklifts.)
Question:
Categories of Commercial Property:
Answer:
Buildings, personal property contained in buildings, money and securities, vehicles and
watercraft, property in the possession of others, property in transit, floating property.
Question:
Significant perils which can result in catastrophic loss:
Answer:
Fire, Theft, Windstorm, Flood, Earthquake, Terrorism, Vandalism, and War.
Question:
For most businesses, what type of peril poses the greatest risk of a large or total
property loss?
Answer:
Fire.
,Question:
Almost all businesses face commercial property loss exposures because they own or
have a legal interest in what 2 kinds of property?
Answer:
Real property, and personal property.
Question:
Joanne owns a construction business. What kind of property are the company forklifts
considered?
Answer:
Personal property.
Question:
When a loss occurs, the property's value can be reduced or eliminated.
Answer:
Financial consequences of loss; Reduced Value:
Question:
Financial consequences of loss; Lost Income:
Answer:
A business may not be able to use the property in question until it has been repaired,
restored or replaced.
Question:
Financial consequences of loss; Extra Expenses:
Answer:
Businesses sometimes have to pay additional costs to keep operating after a loss.
Question:
Key parts of calculating a business income loss are:
Answer:
Determining the lost revenue and any continuing and extra expenses the business
incurred during the period of interruption.
, Question:
Continuing Expenses:
Answer:
Expenses that continue to be incurred during a business interruption, such as payroll of
key employees, debt repayments, taxes, and insurance premiums.
Question:
Extra Expenses:
Answer:
Expenses that are paid in addition to continuing expenses for the purpose of mitigating
the effects of a business interruption, such as relocation, utilities, payroll, and
equipment.
Question:
T/F: The causes of business income losses associated with property exposures are
typically the same as those for physical damage losses.
Answer:
True.
Question:
When property that a business uses to generate income becomes damaged or stolen,
what kind of loss is typically suffered?
Answer:
Business income loss.
Question:
What kinds of expenses constitute continuing expenses?
Answer:
Payroll of key employees, debt repayments, property and payroll taxes, rent or lease
payments, and insurance premiums.
Question:
What are the key parts of calculating a business income loss?
Answer:
Determining the loss revenue and any continuing and extra expenses the business
incurred during the period of interruption.
Question:
Is any condition that presents the possibility that an organization will sustain a loss
resulting from damage or theft of its property.
Answer:
A Commercial Property Loss Exposure is:
Question:
Real Property (Realty):
Answer:
Tangible property consisting of land, all structures permanently attached to the land,
(including fixtures permanently attached) and whatever is growing on the land.
Question:
Personal Property:
Answer:
Includes moveable items owned by a business, such as supplies, furniture, computers,
machinery, tools, and some vehicles, (forklifts.)
Question:
Categories of Commercial Property:
Answer:
Buildings, personal property contained in buildings, money and securities, vehicles and
watercraft, property in the possession of others, property in transit, floating property.
Question:
Significant perils which can result in catastrophic loss:
Answer:
Fire, Theft, Windstorm, Flood, Earthquake, Terrorism, Vandalism, and War.
Question:
For most businesses, what type of peril poses the greatest risk of a large or total
property loss?
Answer:
Fire.
,Question:
Almost all businesses face commercial property loss exposures because they own or
have a legal interest in what 2 kinds of property?
Answer:
Real property, and personal property.
Question:
Joanne owns a construction business. What kind of property are the company forklifts
considered?
Answer:
Personal property.
Question:
When a loss occurs, the property's value can be reduced or eliminated.
Answer:
Financial consequences of loss; Reduced Value:
Question:
Financial consequences of loss; Lost Income:
Answer:
A business may not be able to use the property in question until it has been repaired,
restored or replaced.
Question:
Financial consequences of loss; Extra Expenses:
Answer:
Businesses sometimes have to pay additional costs to keep operating after a loss.
Question:
Key parts of calculating a business income loss are:
Answer:
Determining the lost revenue and any continuing and extra expenses the business
incurred during the period of interruption.
, Question:
Continuing Expenses:
Answer:
Expenses that continue to be incurred during a business interruption, such as payroll of
key employees, debt repayments, taxes, and insurance premiums.
Question:
Extra Expenses:
Answer:
Expenses that are paid in addition to continuing expenses for the purpose of mitigating
the effects of a business interruption, such as relocation, utilities, payroll, and
equipment.
Question:
T/F: The causes of business income losses associated with property exposures are
typically the same as those for physical damage losses.
Answer:
True.
Question:
When property that a business uses to generate income becomes damaged or stolen,
what kind of loss is typically suffered?
Answer:
Business income loss.
Question:
What kinds of expenses constitute continuing expenses?
Answer:
Payroll of key employees, debt repayments, property and payroll taxes, rent or lease
payments, and insurance premiums.
Question:
What are the key parts of calculating a business income loss?
Answer:
Determining the loss revenue and any continuing and extra expenses the business
incurred during the period of interruption.
