AIC 32 Liability Claims Practices Exam
Questions with correct Answers 2025/2026
Already Graded
Professional Liability - ANS-- they have a higher-than-average defendant verdict
- include a consent-to-settle clause, where the insurer has to obtain consent from the
professional to settle the claim
The subjective standard for determining whether injury or property damage involves expected
results can be described as - ANS-What the insured expected and intended from the act.
The objective standard - ANS-is based on what a reasonable person would expect from a
particular act.
Exceptions to the business exclusion for rentals - ANS-- rental on an occasional basis
- renting rooms to no more than two people
- rental for use of an office, a school, a studio, or a private garage.
The BACF applies while - ANS-the insd is in the process of handling cargo from the time it is
picked up until it is "finally" set down. For loading from the moment it is physically accepted,
lifted, or taken to and placed in or on the veh.
Proprietary Function - ANS-a function performed by the government that could just as easily be
performed by a private entity
Trade Dress - ANS-nonfunctional physical detail and design of a product or its packaging,
which distinguishes it from the products of others. (color, design, shapes, placements of words,
decoration, packing)
Negligence Per Se - ANS-Violation of a statute creates a presumption of negligence as a
matter of law.
Concurrent Joint TF - ANS-negligent acts of two or more parties combine to produce a single
injury .they both can be held separately responsible for the entire amount of a claimant's
damages.
Successive Joint TF - ANS-when the negligent acts of two or more parties do not combine to
produce a single event but do combine to produce the injury.
, - damages are divisible and a claimant must seek pymt from each
The 50 percent rule - ANS-permits the plaintiff to recover reduced damages so long as the
plaintiff's negligence is not greater than 50 percent of the total negligence that led to the injury or
damage
Rescue doctrine - ANS-TF can be held liable to any people involved in rescue efforts.
Principle of Unforeseeability - ANS-responsibility is limited to situations where an ordinarily
prudent person could foresee danger under similar circumstances .
For negligence to be proven - ANS-1) duty owed and to whom
2) duty breached
3) proximate cause
4) damages resulted.
Negligent misrepresentation - ANS-- when the seller represents that the product is free from
defects
- the seller cannot be sure that the product is free from defect; the seller knows that a significant
danger exists if there is a defec
- the purchaser relies on the seller's representation
- and the product contains a defect that harms the user
Implied warranty - ANS-obligation that the courts impose on a seller to warrant certain facts
about a product even though not expressly stated by the seller.
Contents of ROR - ANS-- ID of insd, policy period, limits etc
- ack of receipt of loss notice or suit
- description of claim
- reference to each policy provision that might preclude coverage w/ an explanation of why such
a provision may result in a coverage denial
- description of info needed from insd
- ROR to add/modify coverage position later based on add'l issues discovered.
After issuing a reservation of rights, the insurer should - ANS-Advise the insured of any
settlement efforts
besides fraud, the two most common policy violations leading to coverage disputes are: -
ANS-late reporting of losses and Failure to cooperate with the insurance company.
Controversial scientific evidence may be accepted - ANS-as testimony if after a special hearing
is held, it is determined that the principle and methods have been generally accepted in the
scientific community, published and reviewed by peers and the error rate is acceptable.
Questions with correct Answers 2025/2026
Already Graded
Professional Liability - ANS-- they have a higher-than-average defendant verdict
- include a consent-to-settle clause, where the insurer has to obtain consent from the
professional to settle the claim
The subjective standard for determining whether injury or property damage involves expected
results can be described as - ANS-What the insured expected and intended from the act.
The objective standard - ANS-is based on what a reasonable person would expect from a
particular act.
Exceptions to the business exclusion for rentals - ANS-- rental on an occasional basis
- renting rooms to no more than two people
- rental for use of an office, a school, a studio, or a private garage.
The BACF applies while - ANS-the insd is in the process of handling cargo from the time it is
picked up until it is "finally" set down. For loading from the moment it is physically accepted,
lifted, or taken to and placed in or on the veh.
Proprietary Function - ANS-a function performed by the government that could just as easily be
performed by a private entity
Trade Dress - ANS-nonfunctional physical detail and design of a product or its packaging,
which distinguishes it from the products of others. (color, design, shapes, placements of words,
decoration, packing)
Negligence Per Se - ANS-Violation of a statute creates a presumption of negligence as a
matter of law.
Concurrent Joint TF - ANS-negligent acts of two or more parties combine to produce a single
injury .they both can be held separately responsible for the entire amount of a claimant's
damages.
Successive Joint TF - ANS-when the negligent acts of two or more parties do not combine to
produce a single event but do combine to produce the injury.
, - damages are divisible and a claimant must seek pymt from each
The 50 percent rule - ANS-permits the plaintiff to recover reduced damages so long as the
plaintiff's negligence is not greater than 50 percent of the total negligence that led to the injury or
damage
Rescue doctrine - ANS-TF can be held liable to any people involved in rescue efforts.
Principle of Unforeseeability - ANS-responsibility is limited to situations where an ordinarily
prudent person could foresee danger under similar circumstances .
For negligence to be proven - ANS-1) duty owed and to whom
2) duty breached
3) proximate cause
4) damages resulted.
Negligent misrepresentation - ANS-- when the seller represents that the product is free from
defects
- the seller cannot be sure that the product is free from defect; the seller knows that a significant
danger exists if there is a defec
- the purchaser relies on the seller's representation
- and the product contains a defect that harms the user
Implied warranty - ANS-obligation that the courts impose on a seller to warrant certain facts
about a product even though not expressly stated by the seller.
Contents of ROR - ANS-- ID of insd, policy period, limits etc
- ack of receipt of loss notice or suit
- description of claim
- reference to each policy provision that might preclude coverage w/ an explanation of why such
a provision may result in a coverage denial
- description of info needed from insd
- ROR to add/modify coverage position later based on add'l issues discovered.
After issuing a reservation of rights, the insurer should - ANS-Advise the insured of any
settlement efforts
besides fraud, the two most common policy violations leading to coverage disputes are: -
ANS-late reporting of losses and Failure to cooperate with the insurance company.
Controversial scientific evidence may be accepted - ANS-as testimony if after a special hearing
is held, it is determined that the principle and methods have been generally accepted in the
scientific community, published and reviewed by peers and the error rate is acceptable.
