AINS 101 EXAM WITH CORRECT
ANSWERS 2025
Risk ( correct answers ) Uncertainty about outcomes, can be positive or
negative
-Risk management is concerned with both positive and negative,
insurance alleviates the uncertainty associated with negative financial
consequences
Transferring ( correct answers ) The act of moving the financial
consequences of unanticipated events to an insurer
Pooling ( correct answers ) All insureds share the cost of each other's
losses.
-Helps to keep premiums affordable and helps insurers cover large losses
when they occur
The Benefits of Insurance ( correct answers ) 1. Paying
for losses
2. Managing cash flow
3. Complying with legal requirements
4. Promoting risk control activities
Personal Property Insurance ( correct answers ) Protects
an insured's assets by covering the cost of repairing or replacing property
that is damaged, lost, or destroyed. Can cover related lost income or extra
expenses
Personal Liability Insurance ( correct answers ) Provides
payments for injury to others or damage to other's property for which the
insured is legally responsible. It also covers the cost to defend the insured
against related lawsuits
Life Insurance ( correct answers ) Replaces the income-earning
potential lost through death. Helps pay expenses related to an
insureds death
Health Insurance ( correct answers ) Protects individuals and families
from financial losses caused by sickness and accidents
Homeowners Insurance( correct answers ) Provides Protection when
people's homes and/or belongings are damaged or stolen and liability
coverage for situations such as the family dog biting a guest
Personal Auto ( correct answers ) If the insured is at fault in an accident,
provides coverage for bodily injury to another person, or damage to
another person's auto. Also provides coverage for damage to the insured's
auto (not wear and tear). Typically legally required
ANSWERS 2025
Risk ( correct answers ) Uncertainty about outcomes, can be positive or
negative
-Risk management is concerned with both positive and negative,
insurance alleviates the uncertainty associated with negative financial
consequences
Transferring ( correct answers ) The act of moving the financial
consequences of unanticipated events to an insurer
Pooling ( correct answers ) All insureds share the cost of each other's
losses.
-Helps to keep premiums affordable and helps insurers cover large losses
when they occur
The Benefits of Insurance ( correct answers ) 1. Paying
for losses
2. Managing cash flow
3. Complying with legal requirements
4. Promoting risk control activities
Personal Property Insurance ( correct answers ) Protects
an insured's assets by covering the cost of repairing or replacing property
that is damaged, lost, or destroyed. Can cover related lost income or extra
expenses
Personal Liability Insurance ( correct answers ) Provides
payments for injury to others or damage to other's property for which the
insured is legally responsible. It also covers the cost to defend the insured
against related lawsuits
Life Insurance ( correct answers ) Replaces the income-earning
potential lost through death. Helps pay expenses related to an
insureds death
Health Insurance ( correct answers ) Protects individuals and families
from financial losses caused by sickness and accidents
Homeowners Insurance( correct answers ) Provides Protection when
people's homes and/or belongings are damaged or stolen and liability
coverage for situations such as the family dog biting a guest
Personal Auto ( correct answers ) If the insured is at fault in an accident,
provides coverage for bodily injury to another person, or damage to
another person's auto. Also provides coverage for damage to the insured's
auto (not wear and tear). Typically legally required
