AINS Practice EXAM Questions With Complete Solutions
A liability loss has the following damages:
Medical expenses:$10,000
Damages for disfigurement:$50,000
Damages for pain and suffering:$100,000
What is the amount of special damages?
Select one:
A. $ 10,000
B. $ 50,000
C. $100,000
D. $160,000 Correct Answers A. $ 10,000
Correct. The amount of special damages is $10,000. Special
damages are for specific, identifiable expenses.
A stock insurer differs from a reciprocal insurance exchange in
which one of the following ways?
Select one:
A. Both are owned by stockholders. However, the reciprocal
insurance exchange provides coverage to investors.
B. Both are formed to provide profit to investors. However, the
stock insurer is managed through a board of directors.
C. A stock insurer provides insurance to its policyholder-
owners. A reciprocal insurance exchange provides insurance to
investors.
D. Stockholders own a stock insurer. Members own a reciprocal
insurance exchange. Correct Answers D. Stockholders own a
stock insurer. Members own a reciprocal insurance exchange.
,Stockholders own a stock insurer. Members (subscribers) own a
reciprocal insurance exchange.
All of the following are sources of underwriting information to
evaluate an insurance submission, EXCEPT:
Select one:
A. Underwriting authority reports
B. Telematics
C. Inspection reports
D. Applications Correct Answers A. Underwriting authority
reports
Correct. All listed are sources of underwriting information,
EXCEPT 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?
Select one:
A. Allian issues more preprinted policies than manuscript forms.
B. Allian offers modular policies for coverages common to a
large number of its insureds.
C. The manuscript forms that Allian issues are developed by
ISO.
D. Customized coverages are usually issued through a self-
contained policy. Correct Answers A. Allian issues more
preprinted policies than manuscript forms.
Allian issues more preprinted policies than manuscript forms.
, 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:
Select one:
A. Formulate underwriting policy
B. Conduct underwriting audits
C. Research the market
D. Support producers and insureds Correct Answers D. Support
producers and insureds
Correct. All listed are corporate (or staff) underwriting activities,
EXCEPT supporting producers and insureds, which is a field (or
line) underwriter's responsibility.
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
Select one:
A. Contract of indemnity.
B. Contract of adhesion.
C. Contract of utmost good faith.
D. Conditional contract. Correct Answers C. Contract of utmost
good faith.
Correct.Insurance contacts are considered contracts of utmost
good faith because both parties are obligated to ethical practices
and behaviors while dealing with one another.
A liability loss has the following damages:
Medical expenses:$10,000
Damages for disfigurement:$50,000
Damages for pain and suffering:$100,000
What is the amount of special damages?
Select one:
A. $ 10,000
B. $ 50,000
C. $100,000
D. $160,000 Correct Answers A. $ 10,000
Correct. The amount of special damages is $10,000. Special
damages are for specific, identifiable expenses.
A stock insurer differs from a reciprocal insurance exchange in
which one of the following ways?
Select one:
A. Both are owned by stockholders. However, the reciprocal
insurance exchange provides coverage to investors.
B. Both are formed to provide profit to investors. However, the
stock insurer is managed through a board of directors.
C. A stock insurer provides insurance to its policyholder-
owners. A reciprocal insurance exchange provides insurance to
investors.
D. Stockholders own a stock insurer. Members own a reciprocal
insurance exchange. Correct Answers D. Stockholders own a
stock insurer. Members own a reciprocal insurance exchange.
,Stockholders own a stock insurer. Members (subscribers) own a
reciprocal insurance exchange.
All of the following are sources of underwriting information to
evaluate an insurance submission, EXCEPT:
Select one:
A. Underwriting authority reports
B. Telematics
C. Inspection reports
D. Applications Correct Answers A. Underwriting authority
reports
Correct. All listed are sources of underwriting information,
EXCEPT 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?
Select one:
A. Allian issues more preprinted policies than manuscript forms.
B. Allian offers modular policies for coverages common to a
large number of its insureds.
C. The manuscript forms that Allian issues are developed by
ISO.
D. Customized coverages are usually issued through a self-
contained policy. Correct Answers A. Allian issues more
preprinted policies than manuscript forms.
Allian issues more preprinted policies than manuscript forms.
, 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:
Select one:
A. Formulate underwriting policy
B. Conduct underwriting audits
C. Research the market
D. Support producers and insureds Correct Answers D. Support
producers and insureds
Correct. All listed are corporate (or staff) underwriting activities,
EXCEPT supporting producers and insureds, which is a field (or
line) underwriter's responsibility.
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
Select one:
A. Contract of indemnity.
B. Contract of adhesion.
C. Contract of utmost good faith.
D. Conditional contract. Correct Answers C. Contract of utmost
good faith.
Correct.Insurance contacts are considered contracts of utmost
good faith because both parties are obligated to ethical practices
and behaviors while dealing with one another.
