AD BANKER COMPREHENSIVE EXAM
2025
AD BANKER COMPREHENSIVE EXAM
2025/2026 COMPLETE verifies
QUESTIONS AND CORRECT ANSWERS
|ALREADY GRADED A+||BRAND NEW!!
Which risk management type shifts the risk of loss to another party?
A. Avoidance
B. Assumption
C. Reduction
D. Transfer
D. Transfer
A potential cause of loss, such as fire, explosion, flood, or theft is considered to be a(n):
A
Peril
B
Accident
C
Occurrence
D
Hazard
A Peril
A peril is a cause of potential loss to property such as fire, windstorm, hail, or flood.
Which of the following might be considered a physical hazard?
A
Dishonesty on the part of an insured
B
The insured's attitude that good housekeeping is not important
C
The storage of flammables near a furnace
D
The storage of flammables in a fireproof container
C The storage of flammables near a furnace
A+ TEST BANK 1
, AD BANKER COMPREHENSIVE EXAM
2025
A physical hazard is a condition on the property, or exposed to the property, that increases the
probability of loss to the property.
Rates that cannot be used until the Department or Division of Insurance approves them are referred
to as:
A
Use and file rates
B
File and use rates
C
Open competition rates
D
Prior approval rates
D Prior approval rates
In prior approval states, rates cannot be used until the Department or Division of Insurance
authorities approve them, or until a specific time has passed after the filing without being
disapproved.
A fire sprinkler system installed in a factory is considered which of the following methods of
managing risk?
A
Transfer
B
Avoidance
C
Reduction
D
Retention
C Reduction
The fire sprinkler system will minimize the chance and severity of loss, but not entirely prevent it.
When an insurance policy is not clear, the court will usually interpret in favor of the insured because
of which characteristic?
A
The policy is a bilateral contract
B
The policy is an aleatory contract
C
The policy is a contract of adhesion
A+ TEST BANK 2
, AD BANKER COMPREHENSIVE EXAM
2025
D
The policy is a conditional contract
C The policy is a contract of adhesion
A contract of adhesion is a contract between two parties that is written on a 'take it or leave it' basis.
Because the other party has no control over the terms of the contract, any ambiguity is usually
construed against the party who drew it up.
Taxable corporate dividends are received by which type of insurer's shareholders?
A
Mutual
B
Risk Retention Group
C
Reciprocal
D
Stock
D Stock
A stock company is owned by its stockholders who elect the directors and officers.
When writing an application for car insurance, Producer M asked her client, B, if he had been
convicted of driving while intoxicated (DWI) in the past 10 years. B answered 'no,' although he had
been convicted of a DWI last year. B is guilty of which of the following?
A
Waiver
B
Unilateral statement
C
Representation
D
Misrepresentation
D Misrepresentation
Misrepresentation is a false statement in the application and if material, meaning the company's
decision to issue the application would have been different, the policy would be voided.
The insurance contract is said to be a contract of utmost good faith, because:
A
The insured must warrant that his/her representations are true
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, AD BANKER COMPREHENSIVE EXAM
2025
B
The insurer has drawn up the contract and, therefore, there is no intent to deceive
C
Concealment of known facts on the part of the insured will void the contract
D
Each party is entitled to rely upon the representations of the other that there is nothing concealed or
dishonest
D Each party is entitled to rely upon the representations of the other that there is nothing concealed
or dishonest
It is assumed that utmost good faith exists in both parties to the contract.
D does not agree with the insurance company's value of his property damaged as a result of his
recent property loss. Which of the following establishes the procedure D and the insurance company
must use to settle this issue?
A
Appraisal Clause
B
Loss Payable Clause
C
Definitions Clause
D
Claim Settlement Clause
A Appraisal Clause
The Appraisal Clause of the insurance policy provides a method of settling disputes between the
insurer and the insured as an alternative to legal action.
Which part of a property insurance policy describes the perils?
A
Definitions
B
Declarations
C
Insuring Agreement
D
Additional Coverages
C Insuring Agreement
A+ TEST BANK 4
2025
AD BANKER COMPREHENSIVE EXAM
2025/2026 COMPLETE verifies
QUESTIONS AND CORRECT ANSWERS
|ALREADY GRADED A+||BRAND NEW!!
Which risk management type shifts the risk of loss to another party?
A. Avoidance
B. Assumption
C. Reduction
D. Transfer
D. Transfer
A potential cause of loss, such as fire, explosion, flood, or theft is considered to be a(n):
A
Peril
B
Accident
C
Occurrence
D
Hazard
A Peril
A peril is a cause of potential loss to property such as fire, windstorm, hail, or flood.
Which of the following might be considered a physical hazard?
A
Dishonesty on the part of an insured
B
The insured's attitude that good housekeeping is not important
C
The storage of flammables near a furnace
D
The storage of flammables in a fireproof container
C The storage of flammables near a furnace
A+ TEST BANK 1
, AD BANKER COMPREHENSIVE EXAM
2025
A physical hazard is a condition on the property, or exposed to the property, that increases the
probability of loss to the property.
Rates that cannot be used until the Department or Division of Insurance approves them are referred
to as:
A
Use and file rates
B
File and use rates
C
Open competition rates
D
Prior approval rates
D Prior approval rates
In prior approval states, rates cannot be used until the Department or Division of Insurance
authorities approve them, or until a specific time has passed after the filing without being
disapproved.
A fire sprinkler system installed in a factory is considered which of the following methods of
managing risk?
A
Transfer
B
Avoidance
C
Reduction
D
Retention
C Reduction
The fire sprinkler system will minimize the chance and severity of loss, but not entirely prevent it.
When an insurance policy is not clear, the court will usually interpret in favor of the insured because
of which characteristic?
A
The policy is a bilateral contract
B
The policy is an aleatory contract
C
The policy is a contract of adhesion
A+ TEST BANK 2
, AD BANKER COMPREHENSIVE EXAM
2025
D
The policy is a conditional contract
C The policy is a contract of adhesion
A contract of adhesion is a contract between two parties that is written on a 'take it or leave it' basis.
Because the other party has no control over the terms of the contract, any ambiguity is usually
construed against the party who drew it up.
Taxable corporate dividends are received by which type of insurer's shareholders?
A
Mutual
B
Risk Retention Group
C
Reciprocal
D
Stock
D Stock
A stock company is owned by its stockholders who elect the directors and officers.
When writing an application for car insurance, Producer M asked her client, B, if he had been
convicted of driving while intoxicated (DWI) in the past 10 years. B answered 'no,' although he had
been convicted of a DWI last year. B is guilty of which of the following?
A
Waiver
B
Unilateral statement
C
Representation
D
Misrepresentation
D Misrepresentation
Misrepresentation is a false statement in the application and if material, meaning the company's
decision to issue the application would have been different, the policy would be voided.
The insurance contract is said to be a contract of utmost good faith, because:
A
The insured must warrant that his/her representations are true
A+ TEST BANK 3
, AD BANKER COMPREHENSIVE EXAM
2025
B
The insurer has drawn up the contract and, therefore, there is no intent to deceive
C
Concealment of known facts on the part of the insured will void the contract
D
Each party is entitled to rely upon the representations of the other that there is nothing concealed or
dishonest
D Each party is entitled to rely upon the representations of the other that there is nothing concealed
or dishonest
It is assumed that utmost good faith exists in both parties to the contract.
D does not agree with the insurance company's value of his property damaged as a result of his
recent property loss. Which of the following establishes the procedure D and the insurance company
must use to settle this issue?
A
Appraisal Clause
B
Loss Payable Clause
C
Definitions Clause
D
Claim Settlement Clause
A Appraisal Clause
The Appraisal Clause of the insurance policy provides a method of settling disputes between the
insurer and the insured as an alternative to legal action.
Which part of a property insurance policy describes the perils?
A
Definitions
B
Declarations
C
Insuring Agreement
D
Additional Coverages
C Insuring Agreement
A+ TEST BANK 4
