MANAGING HUMAN CAPITAL NEWEST EXAM 2025 WITH
CORRECT QUESTIONS AN VERIFIED ANSWERS.
An agent has authority to do all of the following, except:
A. Appoint a solicitor as his or her representative.
B. Represent the insured's interest.
C. Solicit applications on insurer's behalf.
D. Countersign insurance contracts - ANSWERS-B. Represent the
insured's interest.
* An Agent is primarily the representative of an insurer.
Which type of insurance provides coverage when insurance is not
available from an admitted carrier?
A. Foreign
B. Residual
C. Facultative
D. Surplus - ANSWERS-D. Surplus
*Non-admitted business must be transacted through a surplus lines
broker or producer.
Which of the following is a physical hazard?
A. Dishonesty on the part of an insured.
B. An insured's attitude that good housekeeping is not important.
C. The storage of flammables in a fireproof container.
D. Uneven pavement in a sidewalk - ANSWERS-D. Uneven pavement in
a sidewalk
*A physical hazard is a physical condition that increases the probability
of loss to the property.
,Which Federal entity administers the Terrorism Risk Insurance Program
Reauthorization Act?
A. Department of the Treasury
B. Executive office
C. Secretary os State
D. Department of Defense - ANSWERS-A. Department of the Treasury.
*The terrorism risk insurance act, which protects consumers by ensuring
the continued widespread availability and affordability of property and
casualty insurance for a terrorism risk, is administered by the dept. of
treasury.
The following statements regarding hazards are all correct, except:
A. A gambling addiction could be a moral hazard.
B. A moral hazard arises from a disposition for dishonesty.
C. Ice on a sidewalk is a physical hazard.
D. A moral hazard arises from an attitude of indifference to loss. -
ANSWERS-D. A moral hazard arises from an attitude of indifference to
loss.
Which statement defines a peril?
A. It is a condition that may increase a loss.
B. It is the specific cause of loss.
C. It is an indirect loss
D. It is defined as a risk of financial loss. - ANSWERS-B. It is the
specific cause of loss
What is it called when less desirable insureds seek insurance coverage to
a greater extent than better risks?
A. Estoppel
B. Sharing
,C. Adverse selection
D. Law of large numbers - ANSWERS-C. Adverse selection
*Adverse selection is the tendency of risks more prone to loss to seek
greater than average coverage.
The Law of Large Numbers provides that:
A. As the number of insured units increases, predicability of losses
improves.
B. As the number of insured units increases, losses decrease
C. If funds are insufficient to pay claims, the insured is assessed
additional premium.
D. Small certain losses are substituted for large uncertain losses. -
ANSWERS-A. As the number of insured units increases, predictability of
losses improves.
*The larger the sample is, the more accurate the prediction is.
Which of the following is not true about insurance?
A. Risk is transferred to the insurer
B. The insured may retain part of the risk through deductibles
C. Declining to own a business is an example of risk avoidance
D. Insurance covers intentional as well as unintentional losses -
ANSWERS-D. Insurance covers intentional as well as unintentional
losses.
Which of the following is not an element of an insurable risk?
A. The ability to set a measurable value on it.
B. Accidental loss
C. Large number of homogenous units
D. Catastrophic perils - ANSWERS-D. Catastrophic Perils
, What is the name for an insurer authorized to write insurance policies in
a particular state? - ANSWERS-A. Admitted
Statements in the application that are guaranteed true but later found to
be false at the time of application may result in which of the following?
A. Establishment of a monetary penalty
B. A waiver of the provisions of the warranty
C. Voidance of the contract
D. Nullification of the warranty - ANSWERS-C. Voidance of the
contract
*A breach of warranty is a determination that a warranty has proven to
be untrue, whether intended as a falsehood or not, and may void the
contract.
When both parties to a contract must perform certain duties in order to
make the contract enforceable, this is known as a(n):
A. Aleatory contract
B. Conditional contract
C. Contract of adhesion
D. Unilateral contract - ANSWERS-B. Conditional contract
Each participant of a Lloyds association:
A. Participates on every policy issued
B. Is legally liable for teh unpaid part of any loss sustained by all
defaulting underwriters.
C. Insures against every risk that is underwritten.
D. Is individually liable for each risk they assume. - ANSWERS-D. Is
individually liable for each risk they assume
Risk is defined as:
CORRECT QUESTIONS AN VERIFIED ANSWERS.
An agent has authority to do all of the following, except:
A. Appoint a solicitor as his or her representative.
B. Represent the insured's interest.
C. Solicit applications on insurer's behalf.
D. Countersign insurance contracts - ANSWERS-B. Represent the
insured's interest.
* An Agent is primarily the representative of an insurer.
Which type of insurance provides coverage when insurance is not
available from an admitted carrier?
A. Foreign
B. Residual
C. Facultative
D. Surplus - ANSWERS-D. Surplus
*Non-admitted business must be transacted through a surplus lines
broker or producer.
Which of the following is a physical hazard?
A. Dishonesty on the part of an insured.
B. An insured's attitude that good housekeeping is not important.
C. The storage of flammables in a fireproof container.
D. Uneven pavement in a sidewalk - ANSWERS-D. Uneven pavement in
a sidewalk
*A physical hazard is a physical condition that increases the probability
of loss to the property.
,Which Federal entity administers the Terrorism Risk Insurance Program
Reauthorization Act?
A. Department of the Treasury
B. Executive office
C. Secretary os State
D. Department of Defense - ANSWERS-A. Department of the Treasury.
*The terrorism risk insurance act, which protects consumers by ensuring
the continued widespread availability and affordability of property and
casualty insurance for a terrorism risk, is administered by the dept. of
treasury.
The following statements regarding hazards are all correct, except:
A. A gambling addiction could be a moral hazard.
B. A moral hazard arises from a disposition for dishonesty.
C. Ice on a sidewalk is a physical hazard.
D. A moral hazard arises from an attitude of indifference to loss. -
ANSWERS-D. A moral hazard arises from an attitude of indifference to
loss.
Which statement defines a peril?
A. It is a condition that may increase a loss.
B. It is the specific cause of loss.
C. It is an indirect loss
D. It is defined as a risk of financial loss. - ANSWERS-B. It is the
specific cause of loss
What is it called when less desirable insureds seek insurance coverage to
a greater extent than better risks?
A. Estoppel
B. Sharing
,C. Adverse selection
D. Law of large numbers - ANSWERS-C. Adverse selection
*Adverse selection is the tendency of risks more prone to loss to seek
greater than average coverage.
The Law of Large Numbers provides that:
A. As the number of insured units increases, predicability of losses
improves.
B. As the number of insured units increases, losses decrease
C. If funds are insufficient to pay claims, the insured is assessed
additional premium.
D. Small certain losses are substituted for large uncertain losses. -
ANSWERS-A. As the number of insured units increases, predictability of
losses improves.
*The larger the sample is, the more accurate the prediction is.
Which of the following is not true about insurance?
A. Risk is transferred to the insurer
B. The insured may retain part of the risk through deductibles
C. Declining to own a business is an example of risk avoidance
D. Insurance covers intentional as well as unintentional losses -
ANSWERS-D. Insurance covers intentional as well as unintentional
losses.
Which of the following is not an element of an insurable risk?
A. The ability to set a measurable value on it.
B. Accidental loss
C. Large number of homogenous units
D. Catastrophic perils - ANSWERS-D. Catastrophic Perils
, What is the name for an insurer authorized to write insurance policies in
a particular state? - ANSWERS-A. Admitted
Statements in the application that are guaranteed true but later found to
be false at the time of application may result in which of the following?
A. Establishment of a monetary penalty
B. A waiver of the provisions of the warranty
C. Voidance of the contract
D. Nullification of the warranty - ANSWERS-C. Voidance of the
contract
*A breach of warranty is a determination that a warranty has proven to
be untrue, whether intended as a falsehood or not, and may void the
contract.
When both parties to a contract must perform certain duties in order to
make the contract enforceable, this is known as a(n):
A. Aleatory contract
B. Conditional contract
C. Contract of adhesion
D. Unilateral contract - ANSWERS-B. Conditional contract
Each participant of a Lloyds association:
A. Participates on every policy issued
B. Is legally liable for teh unpaid part of any loss sustained by all
defaulting underwriters.
C. Insures against every risk that is underwritten.
D. Is individually liable for each risk they assume. - ANSWERS-D. Is
individually liable for each risk they assume
Risk is defined as:
