AINS 101 NEWEST COMPLETE 2024 QUESTION WITH 100 %
CORRECT ANSWERS | VERIFIED
Bill is an insurance producer for and employed by ABC
Insurance Company (ABC). He represents only ABC when
marketing insurance products, and uses an administrative
staff also employed by ABC. Bill is a producer in the
Direct writer marketing system
Because the insurance company usually determines policy
wording and the insured has little choice but to "take it or
leave it," an insurance contract is a
Contract of adhesion
Which one of the following best explains why producers
should be alert to changes in clients' loss exposures?
Implemented risk management techniques may prove to be
ineffective or become obsolete
At Greenfield Insurance Company, Bernadette and Rachel
are corporate underwriters, and Tomas and Jose are field
underwriters. All of the following are underwriting activities
typically performed by corporate (or staff) underwriters like
Bernadette and Rachel, EXCEPT:
Support producers and insureds
Joel is the underwriter for Stanton Industries. He received a
notice from the premium auditor on the account. After a
recent visit to the insured's location, the auditor wanted to
make Joel aware of a decline in the business and some
questionable business practices. Which one of the following
types of hazards is the auditor identifying?
Moral hazards
Moral hazards
include questionable business practices or a failing business.
James West is a claims rep with Hatters Insurance. As he
learns how to handle a claim from start to finish, which one
,of the following best describes the correct order for him to
follow during this process?
Identifying the policy, calculating a loss reserve, determining the
cause of loss, preparing a loss statement
Margaret was severely injured and scarred due to a recent
accident. Which one of the following is an example of general
damages Margaret received?
Compensation for disfigurement
Donna is an insurance producer. She makes an appointment
with potential policyholder Sandie to review her loss
exposures. She asks Sandie to complete a questionnaire to
assist her in this effort. Donna is conducting a
Risk management review
Rachel is a new employee of Westley Insurance, and has
been asked to review some existing policies to become
familiar with the types of policies she will be working with.
Which one of the following will Rachel find is true as she
conducts her review?
Rachel finds the policy begins with a coverage overview and then
goes into more coverage details.
Sports, Inc. is looking to obtain a commercial property policy
on its building for $400,000. If their insurer decides to charge
them a rate of $0.50 per $100 of building insurance, what
premium must Sports, Inc. pay?
$2,000
Destructive competition in the insurance industry could
result in
Insurance shortages
The financial report for Hometown Insurer contains the
following information:
Earned premiums$4,000,000Written premiums$5,000,000Net
investment income$1,000,000Incurred
losses$3,000,000Incurred underwriting expenses$2,000,000
What is Hometown Insurer's loss ratio?
75%
,Loss Ratio
incurred losses divided by its earned premiums
Jessie is a new customer service representative (CSR) at the
Winfield Agency. Jessie usually engages in all the following
activities, EXCEPT:
Determining coverage quotes
Riley Turner is performing a comprehensive evaluation of
Hardwick Enterprises to make sure its insurance and risk
management efforts are serving the organization
appropriately. Which one of the following will be true in
regard to this effort?
Besides risk management goals being attainable, they should
also pose a challenge.
Rachel is considering investing in the stock of an insurance
company. Which one of the following is likely to provide the
best indication of the insurer's financial position at this point
in time?
Balance sheet
Balance Sheet
provides the best indication of its financial position because it
shows admitted assets, liabilities, and policyholders' surplus at a
particular point in time.
Which one of the following is the amount of business an
insurer can write based on regulatory guidelines, usually a
comparsion of the insurer's written premiums to the
policyholders' surplus?
Capacity
The two main sectors of the insurance industry are
Property-casualty insurance and life-health insurance
The difference between an independent agency and an
exclusive agency is that an
Exclusive agency is contracted to sell insurance for one insurer or
group of insurers
A liability loss has the following damages:
Medical expenses:$10,000Damages for
, disfigurement:$50,000Damages for pain and
suffering:$100,000
What is the amount of special damages?
$ 10,000
Special damages
specific, identifiable expenses
Sean was driving and caused an injury to a pedestrian
named Wilbur. In the context of the resulting claim made to
Sean's insurance company and assigned to Andrea in the
claims department, Sean and Wilbur and Andrea are,
respectively,
Insured and claimant and claims representative
Earned premiums are the portion of written premiums that
Apply to the part of the policy period that has already occurred.
Which one of these is most directly associated with a
satisfied customer?
Leads and referrals that can be used to generate new business
For a loss exposure to be ideally insurable it must be definite
in
Time, cause, and location.
Because insurance contracts impose an obligation for ethical
practices and behaviors on the parties while dealing with one
another, an insurance contract is called a
Contract of utmost good faith.
Which two of the four quadrants of risk are classified as pure
risks?
Hazard risks and operational risks
Pravalt Construction Company pays less than its
competitors for workers compensation insurance because
Pravalt has had substantially fewer employee injuries than
other firms in its class. This illustrates which one of the
following benefits of insurance?
Promote risk control activity
The processing of almost every claim involves which one of
the following activities?
CORRECT ANSWERS | VERIFIED
Bill is an insurance producer for and employed by ABC
Insurance Company (ABC). He represents only ABC when
marketing insurance products, and uses an administrative
staff also employed by ABC. Bill is a producer in the
Direct writer marketing system
Because the insurance company usually determines policy
wording and the insured has little choice but to "take it or
leave it," an insurance contract is a
Contract of adhesion
Which one of the following best explains why producers
should be alert to changes in clients' loss exposures?
Implemented risk management techniques may prove to be
ineffective or become obsolete
At Greenfield Insurance Company, Bernadette and Rachel
are corporate underwriters, and Tomas and Jose are field
underwriters. All of the following are underwriting activities
typically performed by corporate (or staff) underwriters like
Bernadette and Rachel, EXCEPT:
Support producers and insureds
Joel is the underwriter for Stanton Industries. He received a
notice from the premium auditor on the account. After a
recent visit to the insured's location, the auditor wanted to
make Joel aware of a decline in the business and some
questionable business practices. Which one of the following
types of hazards is the auditor identifying?
Moral hazards
Moral hazards
include questionable business practices or a failing business.
James West is a claims rep with Hatters Insurance. As he
learns how to handle a claim from start to finish, which one
,of the following best describes the correct order for him to
follow during this process?
Identifying the policy, calculating a loss reserve, determining the
cause of loss, preparing a loss statement
Margaret was severely injured and scarred due to a recent
accident. Which one of the following is an example of general
damages Margaret received?
Compensation for disfigurement
Donna is an insurance producer. She makes an appointment
with potential policyholder Sandie to review her loss
exposures. She asks Sandie to complete a questionnaire to
assist her in this effort. Donna is conducting a
Risk management review
Rachel is a new employee of Westley Insurance, and has
been asked to review some existing policies to become
familiar with the types of policies she will be working with.
Which one of the following will Rachel find is true as she
conducts her review?
Rachel finds the policy begins with a coverage overview and then
goes into more coverage details.
Sports, Inc. is looking to obtain a commercial property policy
on its building for $400,000. If their insurer decides to charge
them a rate of $0.50 per $100 of building insurance, what
premium must Sports, Inc. pay?
$2,000
Destructive competition in the insurance industry could
result in
Insurance shortages
The financial report for Hometown Insurer contains the
following information:
Earned premiums$4,000,000Written premiums$5,000,000Net
investment income$1,000,000Incurred
losses$3,000,000Incurred underwriting expenses$2,000,000
What is Hometown Insurer's loss ratio?
75%
,Loss Ratio
incurred losses divided by its earned premiums
Jessie is a new customer service representative (CSR) at the
Winfield Agency. Jessie usually engages in all the following
activities, EXCEPT:
Determining coverage quotes
Riley Turner is performing a comprehensive evaluation of
Hardwick Enterprises to make sure its insurance and risk
management efforts are serving the organization
appropriately. Which one of the following will be true in
regard to this effort?
Besides risk management goals being attainable, they should
also pose a challenge.
Rachel is considering investing in the stock of an insurance
company. Which one of the following is likely to provide the
best indication of the insurer's financial position at this point
in time?
Balance sheet
Balance Sheet
provides the best indication of its financial position because it
shows admitted assets, liabilities, and policyholders' surplus at a
particular point in time.
Which one of the following is the amount of business an
insurer can write based on regulatory guidelines, usually a
comparsion of the insurer's written premiums to the
policyholders' surplus?
Capacity
The two main sectors of the insurance industry are
Property-casualty insurance and life-health insurance
The difference between an independent agency and an
exclusive agency is that an
Exclusive agency is contracted to sell insurance for one insurer or
group of insurers
A liability loss has the following damages:
Medical expenses:$10,000Damages for
, disfigurement:$50,000Damages for pain and
suffering:$100,000
What is the amount of special damages?
$ 10,000
Special damages
specific, identifiable expenses
Sean was driving and caused an injury to a pedestrian
named Wilbur. In the context of the resulting claim made to
Sean's insurance company and assigned to Andrea in the
claims department, Sean and Wilbur and Andrea are,
respectively,
Insured and claimant and claims representative
Earned premiums are the portion of written premiums that
Apply to the part of the policy period that has already occurred.
Which one of these is most directly associated with a
satisfied customer?
Leads and referrals that can be used to generate new business
For a loss exposure to be ideally insurable it must be definite
in
Time, cause, and location.
Because insurance contracts impose an obligation for ethical
practices and behaviors on the parties while dealing with one
another, an insurance contract is called a
Contract of utmost good faith.
Which two of the four quadrants of risk are classified as pure
risks?
Hazard risks and operational risks
Pravalt Construction Company pays less than its
competitors for workers compensation insurance because
Pravalt has had substantially fewer employee injuries than
other firms in its class. This illustrates which one of the
following benefits of insurance?
Promote risk control activity
The processing of almost every claim involves which one of
the following activities?
