AU 61 Questions with CORRECT Answers
Question:
A request for a higher amount of direct loss coverage than needed should cause an
underwriter to seek more information because too much insurance might indicate:
Answer:
A moral hazard.
Question:
Which one of the following statements about determining the value at risk for business
income loss exposures is true?
Answer:
The current values in the business income worksheet may be estimates depending on
the timing of the insured's financial statements.
Question:
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?
Answer:
Property taxes, it takes time to obtain property tax reductions, if they can be obtained
at all.
Question:
A disaster recovery plan can help an organization respond to a loss and help minimize
the period of business interruption. Which one of the following statements about such
plans is true?
Answer:
They will indicate whether it is feasible to continue operations following different types
of direct losses.
Question:
Which one of the following statements about the business income coverage of
Businessowners Policies with an actual loss sustained coverage feature is true?
Answer:
They usually contain a time limit, but no coverage dollar limit.
Question:
A request for a higher amount of direct loss coverage than needed should cause an
underwriter to seek more information because too much insurance might indicate:
Answer:
A moral hazard.
Question:
Which one of the following statements about determining the value at risk for business
income loss exposures is true?
Answer:
The current values in the business income worksheet may be estimates depending on
the timing of the insured's financial statements.
Question:
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?
Answer:
Property taxes, it takes time to obtain property tax reductions, if they can be obtained
at all.
Question:
A disaster recovery plan can help an organization respond to a loss and help minimize
the period of business interruption. Which one of the following statements about such
plans is true?
Answer:
They will indicate whether it is feasible to continue operations following different types
of direct losses.
Question:
Which one of the following statements about the business income coverage of
Businessowners Policies with an actual loss sustained coverage feature is true?
Answer:
They usually contain a time limit, but no coverage dollar limit.
