AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Automatic sprinklers provide the most effective protection against loss
by fire, however underwriters should not overlook the sprinkler leakage
loss exposure. Underwriting considerations for evaluating an account for
sprinkler leakage exposures include which one of the following? -
ANSWERS-Susceptibility of contents to water damage.
There are many methods of controlling flood losses. The most effective
method of control is which one of the following risk control measures? -
ANSWERS-Not building in a flood plain.
ABC, Inc. has property insurance on its factory with a limit of $180,000.
ABC suffers a loss for $100,000 and at the time of the loss, the factory
has an actual cash value (ACV) of $250,000. Assuming an 80%
coinsurance penalty and a $1,000 deductible, which one of the following
represents the amount ABC's insurer will pay? - ANSWERS-$89,000.
First calculate the 80% coinsurance (0.8 * 250,000) = 200,000. Since the
limit was less than that, then take $180,000 limit / $200,000 required =
0.9. Multiply 0.9 by $100,000 loss and then subtract the $1,000
deductible. (0.9*100,000) - 1,000 = $89,000
END OF
PAGE
1
, AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Conducting frequent inspections and enforcing rules for handling
hazardous substances are measures that can assist with which one of the
following? - ANSWERS-Fire prevention.
Which one of the following is the most quantifiable type of property loss
related to cyber risk loss exposures? - ANSWERS-Damage to physical
media.
Underwriters have difficulty predicting both the frequency and severity
of earthquakes with any degree of accuracy. A key underwriting
consideration for evaluating a commercial property account for
earthquake loss exposure would be: - ANSWERS-Areas of earthquake
activity.
Wildfire studies have demonstrated the importance of three factors as
the primary means of predicting catastrophic wildfire losses. The three
factors are fuel sources, slope of the land, and: - ANSWERS-Road
access.
Underwriters usually consider which one of the following perils to be
the most significant cause of a property loss? - ANSWERS-Fire.
END OF
PAGE
2
, AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Verifying the values of property exposed to a loss is an essential part of
commercial property underwriting. For example, if the property values
shown on a commercial property submission are lower than the
property's actual value, then: - ANSWERS-The insurer will not receive
sufficient premium.
Old Church was insured by ABC Insurance Group. Late one winter the
church burned down due to a gas fire. The parishioners decided to
rebuild the church but wanted to keep the ornate architecture of the
previous church which was a large one story building with conference
rooms and an office attached. It was decided that they would construct a
class 2 building of timber or mill construction. One of the challenges
Old Church will most likely run in to will be which one of the following
concerns? - ANSWERS-The cost of using heavy timber materials will
make the project more costly than other building materials.
All of the following are underwriting considerations regarding older
buildings, EXCEPT: - ANSWERS-Plumbing systems using plastic pipes
and fittings.
END OF
PAGE
3
, AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Radcliffe Real Estate Group has purchased an old warehouse building
and is converting it to office space for medical and dental tenants. The
building was correctly built 40 years ago according to building code
requirements at that time, and has been properly maintained and
periodically upgraded since it was built. The electrical system was built
for purposes of providing lighting to the building. Which one of the
following concerns is an underwriter most likely to have about this
building? - ANSWERS-The wiring may not be adequate to power the
new tenants' equipment without causing a fire from excess heat.
When an insurer's risk control representative is on the premises of a
company, which one of the following is often considered a true
indication of management's commitment to the risk control program? -
ANSWERS-Housekeeping practices.
The Ralok Corporation recently suffered a direct fire loss to its property
and will be out of operation for several months. The business wants to
reduce as many of its expenses as possible during this period. Which one
of the following expenses would be most difficult to reduce
immediately? - ANSWERS-Property taxes.
END OF
PAGE
4
QUESTIONS AND
ANSWERS 2026 - 2027
Automatic sprinklers provide the most effective protection against loss
by fire, however underwriters should not overlook the sprinkler leakage
loss exposure. Underwriting considerations for evaluating an account for
sprinkler leakage exposures include which one of the following? -
ANSWERS-Susceptibility of contents to water damage.
There are many methods of controlling flood losses. The most effective
method of control is which one of the following risk control measures? -
ANSWERS-Not building in a flood plain.
ABC, Inc. has property insurance on its factory with a limit of $180,000.
ABC suffers a loss for $100,000 and at the time of the loss, the factory
has an actual cash value (ACV) of $250,000. Assuming an 80%
coinsurance penalty and a $1,000 deductible, which one of the following
represents the amount ABC's insurer will pay? - ANSWERS-$89,000.
First calculate the 80% coinsurance (0.8 * 250,000) = 200,000. Since the
limit was less than that, then take $180,000 limit / $200,000 required =
0.9. Multiply 0.9 by $100,000 loss and then subtract the $1,000
deductible. (0.9*100,000) - 1,000 = $89,000
END OF
PAGE
1
, AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Conducting frequent inspections and enforcing rules for handling
hazardous substances are measures that can assist with which one of the
following? - ANSWERS-Fire prevention.
Which one of the following is the most quantifiable type of property loss
related to cyber risk loss exposures? - ANSWERS-Damage to physical
media.
Underwriters have difficulty predicting both the frequency and severity
of earthquakes with any degree of accuracy. A key underwriting
consideration for evaluating a commercial property account for
earthquake loss exposure would be: - ANSWERS-Areas of earthquake
activity.
Wildfire studies have demonstrated the importance of three factors as
the primary means of predicting catastrophic wildfire losses. The three
factors are fuel sources, slope of the land, and: - ANSWERS-Road
access.
Underwriters usually consider which one of the following perils to be
the most significant cause of a property loss? - ANSWERS-Fire.
END OF
PAGE
2
, AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Verifying the values of property exposed to a loss is an essential part of
commercial property underwriting. For example, if the property values
shown on a commercial property submission are lower than the
property's actual value, then: - ANSWERS-The insurer will not receive
sufficient premium.
Old Church was insured by ABC Insurance Group. Late one winter the
church burned down due to a gas fire. The parishioners decided to
rebuild the church but wanted to keep the ornate architecture of the
previous church which was a large one story building with conference
rooms and an office attached. It was decided that they would construct a
class 2 building of timber or mill construction. One of the challenges
Old Church will most likely run in to will be which one of the following
concerns? - ANSWERS-The cost of using heavy timber materials will
make the project more costly than other building materials.
All of the following are underwriting considerations regarding older
buildings, EXCEPT: - ANSWERS-Plumbing systems using plastic pipes
and fittings.
END OF
PAGE
3
, AU 61 PRACTICE EXAM LATEST
QUESTIONS AND
ANSWERS 2026 - 2027
Radcliffe Real Estate Group has purchased an old warehouse building
and is converting it to office space for medical and dental tenants. The
building was correctly built 40 years ago according to building code
requirements at that time, and has been properly maintained and
periodically upgraded since it was built. The electrical system was built
for purposes of providing lighting to the building. Which one of the
following concerns is an underwriter most likely to have about this
building? - ANSWERS-The wiring may not be adequate to power the
new tenants' equipment without causing a fire from excess heat.
When an insurer's risk control representative is on the premises of a
company, which one of the following is often considered a true
indication of management's commitment to the risk control program? -
ANSWERS-Housekeeping practices.
The Ralok Corporation recently suffered a direct fire loss to its property
and will be out of operation for several months. The business wants to
reduce as many of its expenses as possible during this period. Which one
of the following expenses would be most difficult to reduce
immediately? - ANSWERS-Property taxes.
END OF
PAGE
4
