M-100 QUIZ - Risk Management & Insurance Questions With 100% Correct Answers.

Which of the following types of exposure to loss for a community association is characterized by net losses that may involve a reduction in income or an increase in operating expenses or both? A. Property Exposure to loss Tangible or intangible - real property (buildings, land) or personal property (inventory, furniture) B. Liability Exposure to loss Third party claim of personal or property damage C. Income Exposure to loss Net loss - reduction in income/increase in operating expenses. D. Personnel exposure to loss Claims of employees - Answer C Income exposure to loss Which of the following demonstrates the risk control technique of exposure avoidance? A. A community association rule prohibiting the use of alcohol in the clubhouse B. Conducting weekly fire safety inspections where flammables are stored. C. Contracting for landscaping services D. Backing up all computer files and storing the backup files in a separate place. - Answer A. A community association rule prohibiting the use of alcohol in the clubhouse True or False: The insurance industry is unregulated at the state level. - Answer FALSE Insurance regulations are run by the state not federal government Most states have statutes and regulations affecting community associations that include insurance obligationsTrue or False: The Federal National Mortgage Association (FannieMae) has a direct impact on community association insurance obligations. - Answer TRUE There are 4 entities that have an impact on association insurance obligations: 1. Fannie Mae 2. Freddie Mac 3. Federal housing administration (FHA) 4. Veterans Administration (VA) Which of the following is NOT a common insurance coverage and endorsement for property exposures to loss? A. Commercial package policy insurance (CPP) B. Boiler and machinery insurance C. Flood insurance D. Hired an non-owned automobile liability insurance. - Answer D. Hired an non-owned automobile liability insurance. True or False. Employers' liability insurance provides protection for claims made by employees regarding sexual harassment or discrimination. - Answer FALSE It covers injury's Which terminology for the following homeowners policies is for a condominium or cooperative unit owner? A. HO-6 B. HO-4 C. HO-1 D. HO-2 - Answer A. HO-6 HO-1, HO-2, HO-3, and HO-5 policies for owner-occupied, single-family homes.HO-4 tenant policy HO-6 specifically for condo or cooperative unit owners. True or False. The preservation of life and property are paramount concerns in an insurance contract. - Answer