AINS 101 | 112 Question with 100 % correct answers | Verified

AINS 101 | 112 Question with 100 % correct answers | Verified A liability loss has the following damages: Medical expenses:$10,000Damages for disfigurement:$50,000Damages for pain and suffering:$100,000 What is the amount of special damages? - ANSWER-$ 10,000 .A stock insurer differs from a reciprocal insurance exchange in which one of the following ways? - ANSWER-Stockholders own a stock insurer. Members own a reciprocal insurance exchange. .Actual cash value (ACV) is - ANSWER-Replacement cost minus depreciation .Adhering to the characteristics of an ideally insurable loss exposure in selling insurance help assure that - ANSWER-The insurer is able to charge a premium that the insured can afford to pay .After Marvin's car was stolen, and he was reimbursed for the loss by Greatson Insurance, the police found and returned the vehicle, which was dented and spray-painted, but still had parts that could be usable. Greatson's rights to recover and sell or otherwise dispose of insured property on which it has paid a total loss are called - ANSWER-Salvage rights .Alicia works for the Drewman Agency, Sandi at insurer Greenway Insurance, and Rosa at Grossman Brokers, all as customer service representatives. Which one of the following is true regarding their work? - ANSWER-Alicia can process policy endorsements and explain coverage to her customers .All of the following are categories of liabilities found on an insurer's balance sheet, EXCEPT: - ANSWER-Policyholders' surplus .All of the following are sources of underwriting information to evaluate an insurance submission, EXCEPT: - ANSWER-Underwriting authority reports .Allian Insurance Company is a growing regional insurer selling policies in three states, specializing in personal auto and homeowners policies. Which one of the following is most likely true regarding Allian and the policies it sells? - ANSWER-Allian issues more preprinted policies than manuscript forms. .An insurance policy is considered a contract of adhesion when it is drafted by the - ANSWER-Insurer .An insurer has decided to take an extremely narrow interpretation of a property insurance policy provision to limit the number of loss payments it will need to make. It realizes that its interpretation is probably wrong, but it knows that individual insured's loss amounts will be small, such that most insureds will not take the trouble to file lawsuits against it. The insurer may be violating the principle that an insurance policy is - ANSWER-A contract of utmost good faith .An insurer that was formed for the purpose of earning a profit for its stockholders is a - ANSWER-Stock insurer .An insurer's financial statement shows a loss reserve and an unearned premium reserve. These reserves are part of the insurer's - ANSWER-Total liabilities .As a single mother on a very tight budget, Ciara is tempted to skimp on her insurance. However, her friend Mehmet tells her not to skimp on insurance, because it will help manage her cash flows. Which one of the following examples best illustrates Mehmet's point? - ANSWER-When her car's windshield breaks, Ciara has to pay only $100 of the $600 cost of replacing it. .As an experienced underwriter, Rick has learned to make every effort to avoid a mistake that can produce insufficient premium to cover losses, or pricing that isn't competitive. Which one of the following underwriting mistakes can often cause these issues? - ANSWER-Misclassifying exposures .As it continues to grow, Anchoy Insurance is examining other distribution channels to more effectively market its products. Through this experience, which of one the following will Anchoy most likely learn? - ANSWER-Anchoy can use group marketing to target large numbers of recent local college graduates .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: - ANSWER-Support producers and insureds .Balance Sheet - ANSWER-provides the best indication of its financial position because it shows admitted assets, liabilities, and policyholders' surplus at a particular point in time. .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 - ANSWER-Contract of utmost good faith. .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 - ANSWER-Contract of adhesion .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 - ANSWER-Direct writer marketing system .Bob is shopping for auto insurance. Insurance Company A's rating system determines that Bob should be charged $800 per auto. If Bob is looking to insure four autos, what premium will he be charged by Insurance Company A? - ANSWER-$3,200 .Brian works in the Underwriting department for DGH Insurance. In addition to carefully selecting insureds, he works with producers and premium auditors to ensure accurate classification and pricing. Brian is a - ANSWER-Field underwriter .Can result in loss or gain - ANSWER-Speculative Risk .Carlos is new to the insurance business and is learning about insurance regulation and what he, now working with Grady Insurance, will need to be aware of regarding the subject of compliance. Which one of the following will Carlos find is accurate as he better understands why insurance is regulated? - ANSWER-Insurance regulation protects customers by guaranteeing insurance is available and accessible to everyone who needs it .Clare is a commercial lines underwriter. She always tries to follow underwriting guidelines, effectively evaluate loss exposures, and charge adequate premiums. By doing these things, Clare's goal is to ensure - ANSWER-Adequate policyholders' surplus .Damages for disfigurement are a form of - ANSWER-General damages .Damages for pain and suffering are a form of - ANSWER-General damages .Destructive competition in the insurance industry could result in - ANSWER-Insurance shortages .direct response distribution channel - ANSWER-using social media, email blasts, website ads, and direct mail would be the best .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 - ANSWER-Risk management review .Earned premiums are shown on an insurer's income statement because they are - ANSWER-Revenues .Earned premiums are the portion of written premiums that - ANSWER-Apply to the part of the policy period that has already occurred.