AINS 21

AINS 21 - Segment A | 137 Questions with 100 % correct answers | Verified& Updated 2024 | Already Passed From a risk management viewpoint, insurance is used to A. Prevent the cost of losses B. Reduce the cost of losses C. Transfer the cost of losses D. Isolate the cost of losses. - C. Transfer the cost of losses. A loss exposure is: A. Any condition that presents the possibility of a loss. B. Any condition that precludes the chance of loss. C. The same thing as a peril. D. The same thing as a hazard. - A. Any condition that present the possibility of a loss. Some loss exposures are not easy to retain, avoid, or control. What risk management technique is frequently used to treat such exposures? A. Reinsurance B. Prevention C. Transfer D. Reunderwriting - C. Transfer Insurance is not the only risk management transfer technique. When circumstances are appropriate, transfer can be accomplished through A. Retention B. Noninsurance transfer techniques C. Avoidance D. Loss prevention - B. Noninsurance transfer techniques Another name for liability insurance is A. First-party insurance B. Second-party insurance C. Third-party insurance D. Multiple-party insurance - C. Third party insurance Sally is a recent college graduate who lives in the suburbs and drives to work daily in the city. She recognizes that owning a car creates both property damage and liability exposures for her and at the same time she has the burden of student loans. For someone in Sally's circumstances the most practical risk management technique for dealing with her auto-related loss exposures is A. Risk transfer B. Retention C. Loss control D. Avoidance - A. Risk transfer Retention is often used in combination with insurance as a way of treating loss exposures. One of the major downsides of individuals using retention alone is A. The record keeping associated with the retained losses. B. Availability of insurer loss settlement services. C. The potential for financial ruin. D. The unavailability of insurer loss control services. - C. The potential for financial ruin. Life insurance that provides coverage for a specified period with no cash value is called A. Universal life B. Long-term care insurance C. Term life insurance D. Whole life - C. Term life insurance A small business owner conc