CPCU 500
CPCU 500 FINAL SET EXAM QUESTIONS WITH CORRECT
DETAILED ANSWERS NEWEST
ERM - ANSWER ✔ - (enterprise risk management) the comprehensive process of evaluating,
measuring, and mitigating the many risks that pervade an organization.
Big Data - ANSWER ✔ - Capture, storage, and analysis of data
Smart Products - ANSWER ✔ - Sense their environment, process data, and communicate with other
smart products and smart operations
Internet of Things (IoT) - ANSWER ✔ - A network of objects that transmit data to and from each
other without human interaction
Cloud Computing - ANSWER ✔ - Info, technology, and storage services contractually provided from
remote locations, through the internet or another network, without a direct server connection
Blockchain - ANSWER ✔ - A distributed digital ledger that facilitates secure transactions without the
need for a third party
- Aka. System of verification and confirmation
- maintains a continuously growing list of records (blocks) in chronological order; a new block is
created each time a transaction occurs
Mining - ANSWER ✔ - Consensus process that confirms and verifies
- removed intermediary validation and establishes trust without a centralized authority
4 examples of data-driven decision making - ANSWER ✔ - 1. Telematics
2. Discovering new relationships in data
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3. Text mining
4. Developing new products
Telematics - ANSWER ✔ - The use of technological devices in vehicles with wireless communication
and GPS tracking that transmit data to businesses or government agencies; some return information
for the driver.
Text Mining - ANSWER ✔ - Obtaining info through language recognition
Insurtech - ANSWER ✔ - The use of emerging technologies in the insurance industry
- reduces the uncertainty associated with predicting future events
Sensor - ANSWER ✔ - A device that detects and measures stimuli in its environment
- An IoT object that collects and transmits data
- They assess risk by detecting and measuring objects or conditions on a continuous basis, which
provides early warnings
Preventive Analytics - ANSWER ✔ - Statistical and analytical techniques used to influence or prevent
future events or behaviors**Preventive analytics uses smart products and data analytics to identify
root loss causes and their implications.
The risktech ecosystem includes what 4 things? - ANSWER ✔ - 1. Emerging tech
2. Smart products
3. Smart operations
4. Big data analytics
Deep Learning - ANSWER ✔ - An extension of AI that attempts to understand and mimic neural
networks in the brain through software that simulates image and speech recognition
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Transducer - ANSWER ✔ - A device that converts one form of energy into another
Actuator - ANSWER ✔ - A mechanical device that turns energy into motion or otherwise effectuates
a change in position or rotation using a signal and an energy source.
Accelerometer - ANSWER ✔ - A device that measures acceleration, motion, and tilt.
Computer Vision - ANSWER ✔ - Technology that simulates human vision
- it recognizes an object, gives the object context, and responds to it as a human would
- used in automobiles
- involves detecting, extracting, and analyzing images to better understand them
3 common smart products - ANSWER ✔ - 1. Wearables
2. Drones
3. Robots
Ergonomics - ANSWER ✔ - The science of designing the workplace as well as its equipment and tools
to make specific body movements more comfortable, efficient, and safe
- Wearables are designed with this
Businesses are making investments in their big data infrastructures. How are these investments
laying the groundwork for the continued evolution of the risk management landscape? - ANSWER ✔
- Businesses' investments in big data infrastructure are laying the groundwork for the continued
evolution of the risk management landscape in ways that include empowering organizations and
their risk management professionals to better access and analyze data and to more efficiently and
quickly conceive, develop, and distribute products.
How does data capture work? - ANSWER ✔ - Data capture is enabled primarily by smart products
that sense their environment, process data, and communicate with other smart products and smart
operations through the Internet of Things (IoT).
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Name some smart products being used in risk management today - ANSWER ✔ - A variety of smart
products are being used in various industries to assess and control risk. Some of the most common
include wearables, drones, robots, and smartphones.
Abhinav is a supply chain manager for an automotive manufacturer. He is concerned about how the
forecasted winter will affect supply. How could smart products address his concerns? - ANSWER ✔ -
Sensor data could inform Abhinav when weather conditions have interrupted the production of
parts, allowing him to quickly make adjustments in shipments and deliveries.
How do sensors assess risk? - ANSWER ✔ - Sensors assess risk by detecting and measuring objects or
conditions on a continuous basis; this provides early warnings of impending problems or
malfunctions and determines whether expected results have occurred.
A financial institution is looking to implement an emerging technology that can identify a trader who
is committing the institution to excessive financial risk and respond with built-in financial circuit
breakers to limit the risk. Which emerging technology would the financial institution want to
implement? - ANSWER ✔ - Artificial intelligence (AI) would be the emerging technology to
implement for this purpose. AI refers to the ability of machines to simulate human intelligence, and
it trains machines on the nuances of sources and the causes of various risks, then establishes
automatic responses based on a set of rules.
Name the types of information that smart products are helping risk managers obtain. - ANSWER ✔ -
Smart products are increasing the information risk managers have on hand—information about
dangerous chemicals in the air, shipping malfunctions, exhausted workers, and almost any other
facet of an organization's operations.
Juan is the property manager of multiple shopping centers. He wants to invest in smart operations to
save costs and labor in the long term. What are some smart products Juan could invest in? -
ANSWER ✔ - Juan could invest in drones for surveillance and monitoring of damage and security
risks at his different locations. He could also automate the leasing process through the use of robots
to process documents and payments and answer property-related questions.
5 pieces of the connected ecosystem - ANSWER ✔ - 1. Property
2. Supply chain
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CPCU 500
©®
CPCU 500 FINAL SET EXAM QUESTIONS WITH CORRECT
DETAILED ANSWERS NEWEST
ERM - ANSWER ✔ - (enterprise risk management) the comprehensive process of evaluating,
measuring, and mitigating the many risks that pervade an organization.
Big Data - ANSWER ✔ - Capture, storage, and analysis of data
Smart Products - ANSWER ✔ - Sense their environment, process data, and communicate with other
smart products and smart operations
Internet of Things (IoT) - ANSWER ✔ - A network of objects that transmit data to and from each
other without human interaction
Cloud Computing - ANSWER ✔ - Info, technology, and storage services contractually provided from
remote locations, through the internet or another network, without a direct server connection
Blockchain - ANSWER ✔ - A distributed digital ledger that facilitates secure transactions without the
need for a third party
- Aka. System of verification and confirmation
- maintains a continuously growing list of records (blocks) in chronological order; a new block is
created each time a transaction occurs
Mining - ANSWER ✔ - Consensus process that confirms and verifies
- removed intermediary validation and establishes trust without a centralized authority
4 examples of data-driven decision making - ANSWER ✔ - 1. Telematics
2. Discovering new relationships in data
1|Page
CPCU 500
©®
,CPCU 500
3. Text mining
4. Developing new products
Telematics - ANSWER ✔ - The use of technological devices in vehicles with wireless communication
and GPS tracking that transmit data to businesses or government agencies; some return information
for the driver.
Text Mining - ANSWER ✔ - Obtaining info through language recognition
Insurtech - ANSWER ✔ - The use of emerging technologies in the insurance industry
- reduces the uncertainty associated with predicting future events
Sensor - ANSWER ✔ - A device that detects and measures stimuli in its environment
- An IoT object that collects and transmits data
- They assess risk by detecting and measuring objects or conditions on a continuous basis, which
provides early warnings
Preventive Analytics - ANSWER ✔ - Statistical and analytical techniques used to influence or prevent
future events or behaviors**Preventive analytics uses smart products and data analytics to identify
root loss causes and their implications.
The risktech ecosystem includes what 4 things? - ANSWER ✔ - 1. Emerging tech
2. Smart products
3. Smart operations
4. Big data analytics
Deep Learning - ANSWER ✔ - An extension of AI that attempts to understand and mimic neural
networks in the brain through software that simulates image and speech recognition
2|Page
CPCU 500
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,CPCU 500
Transducer - ANSWER ✔ - A device that converts one form of energy into another
Actuator - ANSWER ✔ - A mechanical device that turns energy into motion or otherwise effectuates
a change in position or rotation using a signal and an energy source.
Accelerometer - ANSWER ✔ - A device that measures acceleration, motion, and tilt.
Computer Vision - ANSWER ✔ - Technology that simulates human vision
- it recognizes an object, gives the object context, and responds to it as a human would
- used in automobiles
- involves detecting, extracting, and analyzing images to better understand them
3 common smart products - ANSWER ✔ - 1. Wearables
2. Drones
3. Robots
Ergonomics - ANSWER ✔ - The science of designing the workplace as well as its equipment and tools
to make specific body movements more comfortable, efficient, and safe
- Wearables are designed with this
Businesses are making investments in their big data infrastructures. How are these investments
laying the groundwork for the continued evolution of the risk management landscape? - ANSWER ✔
- Businesses' investments in big data infrastructure are laying the groundwork for the continued
evolution of the risk management landscape in ways that include empowering organizations and
their risk management professionals to better access and analyze data and to more efficiently and
quickly conceive, develop, and distribute products.
How does data capture work? - ANSWER ✔ - Data capture is enabled primarily by smart products
that sense their environment, process data, and communicate with other smart products and smart
operations through the Internet of Things (IoT).
3|Page
CPCU 500
©®
, CPCU 500
Name some smart products being used in risk management today - ANSWER ✔ - A variety of smart
products are being used in various industries to assess and control risk. Some of the most common
include wearables, drones, robots, and smartphones.
Abhinav is a supply chain manager for an automotive manufacturer. He is concerned about how the
forecasted winter will affect supply. How could smart products address his concerns? - ANSWER ✔ -
Sensor data could inform Abhinav when weather conditions have interrupted the production of
parts, allowing him to quickly make adjustments in shipments and deliveries.
How do sensors assess risk? - ANSWER ✔ - Sensors assess risk by detecting and measuring objects or
conditions on a continuous basis; this provides early warnings of impending problems or
malfunctions and determines whether expected results have occurred.
A financial institution is looking to implement an emerging technology that can identify a trader who
is committing the institution to excessive financial risk and respond with built-in financial circuit
breakers to limit the risk. Which emerging technology would the financial institution want to
implement? - ANSWER ✔ - Artificial intelligence (AI) would be the emerging technology to
implement for this purpose. AI refers to the ability of machines to simulate human intelligence, and
it trains machines on the nuances of sources and the causes of various risks, then establishes
automatic responses based on a set of rules.
Name the types of information that smart products are helping risk managers obtain. - ANSWER ✔ -
Smart products are increasing the information risk managers have on hand—information about
dangerous chemicals in the air, shipping malfunctions, exhausted workers, and almost any other
facet of an organization's operations.
Juan is the property manager of multiple shopping centers. He wants to invest in smart operations to
save costs and labor in the long term. What are some smart products Juan could invest in? -
ANSWER ✔ - Juan could invest in drones for surveillance and monitoring of damage and security
risks at his different locations. He could also automate the leasing process through the use of robots
to process documents and payments and answer property-related questions.
5 pieces of the connected ecosystem - ANSWER ✔ - 1. Property
2. Supply chain
4|Page
CPCU 500
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