AINS 101 CORE 2026 MAIN QUESTIONS AND
ANSWERS RATED A+
✔✔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 general damages?
A. $ 60,000
B. $110,000
C. $150,000
D. $160,000 - ✔✔$150,000 (The amount of general damages is $150,000. General
damages are for losses that do not have a specific economic value.)
✔✔Adjuster Toni is evaluating damages in a bodily injury liability claim where she has
determined that the insured is completely at fault for the accident. The claimant suffered
a sprain and strain injury to his neck. His special damages total $1,500. He was out of
work for a week, was disabled and prevented from performing some regular activities
for a month, and attended physical therapy for six weeks. In assessing general
damages, Toni should
A. Multiply $1,500, the amount of special damages, by six, the number of weeks of
physical therapy, and pay $9,000.
B. Use past cases which are similar as a guide.
C. Consider what she would want to be paid if she were in claimant's shoes.
D. Multiply the amount of special damages of $1,500 by three as a rule of thumb, and
pay $4,500. - ✔✔Use past cases which are similar as a guide.
(In assessing general damages, Toni should use past cases which are similar as a
guide.)
,✔✔Producer Gerald Hilker is one of the most successful producers at the Westfield
Agency, which represents several different insurers. Because of this, which one of the
following is most likely true?
A. Gerald makes most of his income from commissions from customer sales.
B. Gerald usually presents a proposal for coverage soon after meeting prospective
insureds.
C. Gerald's interactions with customers usually end after he issues them their policies.
D. Gerald, due to his success at the agency, is more accurately an "agent" than a
"producer". - ✔✔Gerald makes most of his income from commissions from customer
sales.
(Gerald makes most of his income from commissions from customer sales. B and C are
both incorrect as a long term relationship with customers is more beneficial than a one
time or hurried sale. D is incorrect as the two terms are synonymous for anyone selling
insurance for one or more insurers.)
✔✔Which one of the following lists provides the optimum order of responsibilities that a
producer may engage with any customer on a continual basis?
A. Meeting a prospective customer, giving advice, issuing the policy, adjusting a claim
B. Meeting a prospective customer, doing a needs and activities analysis, preparing a
coverage proposal, closing the sale
C. Meeting a prospective customer, issuing the policy, collecting premiums, adjusting a
claim.
D. Meeting a prospective customer, reviewing a loss run, issuing a policy, receiving a
commission - ✔✔Meeting a prospective customer, doing a needs and activities
analysis, preparing a coverage proposal, closing the sale
✔✔Lacey is a customer service representative (CSR) who has been employed by
Greeley Insurance for five years. She worked in Greeley's call center for just a year
when she was moved to a busy insurance office staffed primarily with claims
representatives and producers. As she continues her exemplary service to Greeley and
its customers, which one of the following best describes how she supports her fellow
insurance professionals in her role as a CSR?
A. Lacey is not permitted to show empathy or take information related to a new loss that
just occurred.
B. Lacey performs all the roles of a claims professional and a producer but with a
different title.
C. Lacey has been trained to replicate many of the activities performed by producers.
D. Lacey is not permitted to give advice on how a customer may meet specific coverage
needs. - ✔✔Lacey has been trained to replicate many of the activities performed by
producers.
(Lacey has been trained to replicate many of the activities performed by producers.)
,✔✔Which one of the following accurately describes activities related to customer
service representatives?
A. It costs more in advertising to keep an existing customer than to attract a new one.
B. It takes longer to renew an existing account than it does to write a piece of new
business.
C. Profitability in the insurance business is directly linked to customer retention.
D. Excellent service builds strong relationships but not necessarily customer loyalty. -
✔✔Profitability in the insurance business is directly linked to customer retention.
✔✔Robin, a producer from Grantley Insurance, is always alert to changes in her clients'
loss exposures. Why is this so important?
A. Implemented risk management techniques may prove to be ineffective or become
obsolete.
B. Knowledge of such changes will inform their efforts to create a list of experts that can
be called to assist.
C. Producers have expertise about risk financing through insurance.
D. Producers can aid clients in developing risk management cost allocation plans. -
✔✔Implemented risk management techniques may prove to be ineffective or become
obsolete. (Correct. Producers should be alert to changes in clients' loss exposures
because implemented risk management techniques may prove to be ineffective or
become obsolete.
✔✔Leadon Transportation is using the expertise of its producer Carmen to help the
organization understand how to correct substandard performance as well as evaluate
exceeded standards. One measurement she will use is the cost of risk which is best
described as
A. The terms of insurance or other risk-financing mechanisms.
B. The total cost of all aspects of the organization that relate to managing risk.
C. Substandard performance and/or risk management standards.
D. The allocation of risk management costs. - ✔✔The total cost of all aspects of the
organization that relate to managing risk. (Cost of risk involves the total cost of all
aspects of the organization that relate to managing risk.)
✔✔Tony is a producer working with several different insurers. Which one of the
following most accurately describes Tony's activities for reaching and serving
customers?
A. Tony will generally need to spend less time insuring a family's activities than a
business' services and liabilities.
B. Tony's job of selling is usually confined to the one type of insurance coverage the
customer initially requests from him.
, C. A loss run will be most helpful to Tony in helping his personal customers with their
risk management concerns.
D. Policy issuance is a more important function of Tony's work than making sales or
claims handling. - ✔✔Tony will generally need to spend less time insuring a family's
activities than a business' services and liabilities.
✔✔Alicia works for the Drewman Agency, Sandi at insurer Greenway Insurance, and
Rosa at Grossman Brokers, all as customer service representatives. Which one of the
following is true regarding their work?
A. Alicia can process policy endorsements and explain coverage to her customers.
B. Sandi, Alicia, and Rosa are not involved in the generation of new business.
C. Rosa can provide superior service but is not generally involved in attracting new
customers.
D. Sandi is the only one who can replicate the activities of a producer. - ✔✔Alicia can
process policy endorsements and explain coverage to her customers.
✔✔Producer Josh never tires in encouraging insureds to adopt and sustain a robust
and measurable risk management program. As part of this effort, which one of the
following will Josh find is true?
A. The second step occurs when the producer and the business agree on what success
looks like for the risk management program.
B. Risk management goals should be attainable to the organization, but they should
also pose a challenge.
C. Results-based standards are always more important than activity standards to the
overall success of an organization.
D. The first - and most important of all steps in the process - is to establish standards of
acceptable performance. - ✔✔Risk management goals should be attainable to the
organization, but they should also pose a challenge.
✔✔Waycroft Industries is working with their insurance producer Graydon Murphy.
Graydon and the risk managers at Waycroft have already completed the first step of the
risk consultation process. The second step of the process is
A. Determining the standards of acceptable performance to be used.
B. Revising the standards or correcting any substandard performance.
C. Comparing an organization's results with established performance standards.
D. Doing an evaluation of any substantially exceeded standards. - ✔✔Comparing an
organization's results with established performance standards. (The second step of the
risk consultation process is comparing an organization's results with established
performance standards.)
✔✔Ideally insurable loss exposures are subject to losses that
ANSWERS RATED A+
✔✔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 general damages?
A. $ 60,000
B. $110,000
C. $150,000
D. $160,000 - ✔✔$150,000 (The amount of general damages is $150,000. General
damages are for losses that do not have a specific economic value.)
✔✔Adjuster Toni is evaluating damages in a bodily injury liability claim where she has
determined that the insured is completely at fault for the accident. The claimant suffered
a sprain and strain injury to his neck. His special damages total $1,500. He was out of
work for a week, was disabled and prevented from performing some regular activities
for a month, and attended physical therapy for six weeks. In assessing general
damages, Toni should
A. Multiply $1,500, the amount of special damages, by six, the number of weeks of
physical therapy, and pay $9,000.
B. Use past cases which are similar as a guide.
C. Consider what she would want to be paid if she were in claimant's shoes.
D. Multiply the amount of special damages of $1,500 by three as a rule of thumb, and
pay $4,500. - ✔✔Use past cases which are similar as a guide.
(In assessing general damages, Toni should use past cases which are similar as a
guide.)
,✔✔Producer Gerald Hilker is one of the most successful producers at the Westfield
Agency, which represents several different insurers. Because of this, which one of the
following is most likely true?
A. Gerald makes most of his income from commissions from customer sales.
B. Gerald usually presents a proposal for coverage soon after meeting prospective
insureds.
C. Gerald's interactions with customers usually end after he issues them their policies.
D. Gerald, due to his success at the agency, is more accurately an "agent" than a
"producer". - ✔✔Gerald makes most of his income from commissions from customer
sales.
(Gerald makes most of his income from commissions from customer sales. B and C are
both incorrect as a long term relationship with customers is more beneficial than a one
time or hurried sale. D is incorrect as the two terms are synonymous for anyone selling
insurance for one or more insurers.)
✔✔Which one of the following lists provides the optimum order of responsibilities that a
producer may engage with any customer on a continual basis?
A. Meeting a prospective customer, giving advice, issuing the policy, adjusting a claim
B. Meeting a prospective customer, doing a needs and activities analysis, preparing a
coverage proposal, closing the sale
C. Meeting a prospective customer, issuing the policy, collecting premiums, adjusting a
claim.
D. Meeting a prospective customer, reviewing a loss run, issuing a policy, receiving a
commission - ✔✔Meeting a prospective customer, doing a needs and activities
analysis, preparing a coverage proposal, closing the sale
✔✔Lacey is a customer service representative (CSR) who has been employed by
Greeley Insurance for five years. She worked in Greeley's call center for just a year
when she was moved to a busy insurance office staffed primarily with claims
representatives and producers. As she continues her exemplary service to Greeley and
its customers, which one of the following best describes how she supports her fellow
insurance professionals in her role as a CSR?
A. Lacey is not permitted to show empathy or take information related to a new loss that
just occurred.
B. Lacey performs all the roles of a claims professional and a producer but with a
different title.
C. Lacey has been trained to replicate many of the activities performed by producers.
D. Lacey is not permitted to give advice on how a customer may meet specific coverage
needs. - ✔✔Lacey has been trained to replicate many of the activities performed by
producers.
(Lacey has been trained to replicate many of the activities performed by producers.)
,✔✔Which one of the following accurately describes activities related to customer
service representatives?
A. It costs more in advertising to keep an existing customer than to attract a new one.
B. It takes longer to renew an existing account than it does to write a piece of new
business.
C. Profitability in the insurance business is directly linked to customer retention.
D. Excellent service builds strong relationships but not necessarily customer loyalty. -
✔✔Profitability in the insurance business is directly linked to customer retention.
✔✔Robin, a producer from Grantley Insurance, is always alert to changes in her clients'
loss exposures. Why is this so important?
A. Implemented risk management techniques may prove to be ineffective or become
obsolete.
B. Knowledge of such changes will inform their efforts to create a list of experts that can
be called to assist.
C. Producers have expertise about risk financing through insurance.
D. Producers can aid clients in developing risk management cost allocation plans. -
✔✔Implemented risk management techniques may prove to be ineffective or become
obsolete. (Correct. Producers should be alert to changes in clients' loss exposures
because implemented risk management techniques may prove to be ineffective or
become obsolete.
✔✔Leadon Transportation is using the expertise of its producer Carmen to help the
organization understand how to correct substandard performance as well as evaluate
exceeded standards. One measurement she will use is the cost of risk which is best
described as
A. The terms of insurance or other risk-financing mechanisms.
B. The total cost of all aspects of the organization that relate to managing risk.
C. Substandard performance and/or risk management standards.
D. The allocation of risk management costs. - ✔✔The total cost of all aspects of the
organization that relate to managing risk. (Cost of risk involves the total cost of all
aspects of the organization that relate to managing risk.)
✔✔Tony is a producer working with several different insurers. Which one of the
following most accurately describes Tony's activities for reaching and serving
customers?
A. Tony will generally need to spend less time insuring a family's activities than a
business' services and liabilities.
B. Tony's job of selling is usually confined to the one type of insurance coverage the
customer initially requests from him.
, C. A loss run will be most helpful to Tony in helping his personal customers with their
risk management concerns.
D. Policy issuance is a more important function of Tony's work than making sales or
claims handling. - ✔✔Tony will generally need to spend less time insuring a family's
activities than a business' services and liabilities.
✔✔Alicia works for the Drewman Agency, Sandi at insurer Greenway Insurance, and
Rosa at Grossman Brokers, all as customer service representatives. Which one of the
following is true regarding their work?
A. Alicia can process policy endorsements and explain coverage to her customers.
B. Sandi, Alicia, and Rosa are not involved in the generation of new business.
C. Rosa can provide superior service but is not generally involved in attracting new
customers.
D. Sandi is the only one who can replicate the activities of a producer. - ✔✔Alicia can
process policy endorsements and explain coverage to her customers.
✔✔Producer Josh never tires in encouraging insureds to adopt and sustain a robust
and measurable risk management program. As part of this effort, which one of the
following will Josh find is true?
A. The second step occurs when the producer and the business agree on what success
looks like for the risk management program.
B. Risk management goals should be attainable to the organization, but they should
also pose a challenge.
C. Results-based standards are always more important than activity standards to the
overall success of an organization.
D. The first - and most important of all steps in the process - is to establish standards of
acceptable performance. - ✔✔Risk management goals should be attainable to the
organization, but they should also pose a challenge.
✔✔Waycroft Industries is working with their insurance producer Graydon Murphy.
Graydon and the risk managers at Waycroft have already completed the first step of the
risk consultation process. The second step of the process is
A. Determining the standards of acceptable performance to be used.
B. Revising the standards or correcting any substandard performance.
C. Comparing an organization's results with established performance standards.
D. Doing an evaluation of any substantially exceeded standards. - ✔✔Comparing an
organization's results with established performance standards. (The second step of the
risk consultation process is comparing an organization's results with established
performance standards.)
✔✔Ideally insurable loss exposures are subject to losses that
