ESTUDYR
AINS 103 UPDATED EXAM WITH MOST TESTED QUESTIONS AND ANSWERS |
GRADED A+ | ASSURED SUCCESS WITH DETAILED RATIONALES
1. Which one of the following best describes real property?
A. Property being shipped to or from others.
B. Business personal property that includes furniture, machinery and equipment, and
stock/inventory.
C. Tangible property that includes land, structures permanently attached to the land,
and whatever is growing on the land.
D. Vehicles, merchandise, furniture, tools, and similar items.
Rationale: Real property (realty) is land and things permanently attached to it.
2. Extra expenses are expenses, in addition to ordinary expenses, that an organization
incurs to mitigate a business interruption. Which is an example?
A. Cost to rent temporary office space
B. Insurance premiums
C. Debt repayments
D. Payroll of key employees
Rationale: Renting temporary space is an extra expense specifically incurred because of
interruption.
3. Customer grasps a handrail that breaks and breaks wrist. This is an example of which
CGL loss?
A. Premises and operations liability
B. Personal and advertising injury liability
C. Absolute liability
D. Products and completed operations liability
Rationale: Injury due to unsafe premises is premises and operations exposure.
4. Liability exposure when bodily injury/property damage occurs on an organization's
owned/leased property is:
A. Professional liability
B. Property liability
C. Operations liability
D. Premises and operations liability
Rationale: Premises & operations covers incidents on owned/leased premises and
during operations.
5. Automobile liability exposures can result from:
A. Damage to or destruction of an owned vehicle.
,ESTUDYR
B. Loss of use of an owned automobile.
C. Workers compensation laws.
D. Hiring or borrowing an automobile.
Rationale: Hiring/borrowing autos creates liability exposure for the hirer/borrower.
6. To be covered under workers’ compensation, an injury/disease must (in most states):
A. Result from the employer's negligence
B. Occur away from the regular work premises
C. Arise out of employees' job-related injuries and diseases
D. Result in total disability
Rationale: WC covers injuries arising out of and in the course of employment.
7. Cyber risk intellectual property loss exposures include:
A. Cyber extortion of trade secrets.
B. Personal and advertising injury liability
C. Loss to tangible property
D. Property damage liability
Rationale: Cyber extortion targeting trade secrets is an IP-focused cyber exposure.
8. Which is best classified as intangible property loss?
A. Two employees transfer office funds to personal accounts.
B. The computer system is hacked and credit card numbers are stolen.
C. Thieves steal desktop computers.
D. Fire destroys backup copy.
Answer: B. The computer system is hacked and data including credit card numbers are
stolen.
Rationale: Theft of data (information) is intangible property loss.
9. Term generally used in property policies to refer to furniture, machinery and finished
products:
A. Business personal property
B. Stock
C. Inventory
D. Commercial property
Rationale: Business personal property is the standard policy term for such items.
10. Family injured when roof collapsed; lawsuit finds builder liable. This is which liability
exposure for the construction company?
A. Products liability
B. Premises and operations liability
,ESTUDYR
C. Completed operations liability
D. Employers liability
Rationale: Injuries arising after construction is completed fall under completed
operations.
11. Which is an example covered by products & completed operations portion of CGL?
A. A defective gas range manufactured by the insured explodes causing injury.
B. Customer’s house set on fire while doing plumbing work
C. Defamation (slander) suit
D. Slip on wet floor in store
Rationale: Product defect causing injury is a products exposure.
12. Joe Motors wants to maintain customer goodwill. Best accomplished by:
A. Purchasing garage liability insurance.
B. Purchasing garagekeepers insurance.
C. Lowering physical damage deductible.
D. Raising liability limits.
Rationale: Garagekeepers covers customers’ vehicles under care, custody, control —
directly protects goodwill.
13. Workers compensation benefits include:
A. Death benefits of 100% of wage loss
B. Pain and suffering benefits
C. Rehabilitation benefits
D. Property damage benefits
Rationale: WC typically includes medical, wage replacement, and rehabilitation services.
14. An email with a harmful attachment leads to hackers obtaining customer contact info.
This cyber loss is:
A. Damage to intangible property.
B. Damage to personal property
C. Damage to tangible property
D. Errors and omissions liability
Rationale: Loss of customer data is damage to intangible property (information).
15. Web-based business: hacker deletes sales & contact data on server. Type of loss:
A. Tangible property
B. Personal injury
C. Intangible property
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D. Contingent business income
Rationale: Deleted records are intangible assets (data).
16. In property insurance, "personal property" refers to:
A. Property in transit
B. Contents in and around a building
C. Buildings not attached to main building
D. Company's copyrights and trademarks
Rationale: Personal property in property policies = contents/furnishings, i.e., business
personal property.
17. In business income insurance, expenses that would not have been incurred absent
interruption are called:
A. Continuing expenses
B. Contingent expenses
C. Excludable expenses
D. Extra expenses
Rationale: Extra expenses are incurred only because of the interruption to minimize
income loss.
18. Tire store installs wheels; wheel falls off causing crash. Tire store’s exposure is:
A. Employers liability
B. Completed operations liability
C. Automobile liability
D. Products liability
Rationale: Liability arising from completed service (installation) causing injury is
completed operations.
19. Loss exposures when business can be held liable for injury/damage caused by their
repair or contracting work:
A. Operations liability
B. Completed operations liability
C. Workers' compensation liability
D. Products liability
Rationale: Completed operations addresses liability after work is finished.
20. Inland marine insurance covers:
A. Businesses that own/operate watercraft
B. Many classes of property involving transportation on land
C. Companies shipping by inland waterways
AINS 103 UPDATED EXAM WITH MOST TESTED QUESTIONS AND ANSWERS |
GRADED A+ | ASSURED SUCCESS WITH DETAILED RATIONALES
1. Which one of the following best describes real property?
A. Property being shipped to or from others.
B. Business personal property that includes furniture, machinery and equipment, and
stock/inventory.
C. Tangible property that includes land, structures permanently attached to the land,
and whatever is growing on the land.
D. Vehicles, merchandise, furniture, tools, and similar items.
Rationale: Real property (realty) is land and things permanently attached to it.
2. Extra expenses are expenses, in addition to ordinary expenses, that an organization
incurs to mitigate a business interruption. Which is an example?
A. Cost to rent temporary office space
B. Insurance premiums
C. Debt repayments
D. Payroll of key employees
Rationale: Renting temporary space is an extra expense specifically incurred because of
interruption.
3. Customer grasps a handrail that breaks and breaks wrist. This is an example of which
CGL loss?
A. Premises and operations liability
B. Personal and advertising injury liability
C. Absolute liability
D. Products and completed operations liability
Rationale: Injury due to unsafe premises is premises and operations exposure.
4. Liability exposure when bodily injury/property damage occurs on an organization's
owned/leased property is:
A. Professional liability
B. Property liability
C. Operations liability
D. Premises and operations liability
Rationale: Premises & operations covers incidents on owned/leased premises and
during operations.
5. Automobile liability exposures can result from:
A. Damage to or destruction of an owned vehicle.
,ESTUDYR
B. Loss of use of an owned automobile.
C. Workers compensation laws.
D. Hiring or borrowing an automobile.
Rationale: Hiring/borrowing autos creates liability exposure for the hirer/borrower.
6. To be covered under workers’ compensation, an injury/disease must (in most states):
A. Result from the employer's negligence
B. Occur away from the regular work premises
C. Arise out of employees' job-related injuries and diseases
D. Result in total disability
Rationale: WC covers injuries arising out of and in the course of employment.
7. Cyber risk intellectual property loss exposures include:
A. Cyber extortion of trade secrets.
B. Personal and advertising injury liability
C. Loss to tangible property
D. Property damage liability
Rationale: Cyber extortion targeting trade secrets is an IP-focused cyber exposure.
8. Which is best classified as intangible property loss?
A. Two employees transfer office funds to personal accounts.
B. The computer system is hacked and credit card numbers are stolen.
C. Thieves steal desktop computers.
D. Fire destroys backup copy.
Answer: B. The computer system is hacked and data including credit card numbers are
stolen.
Rationale: Theft of data (information) is intangible property loss.
9. Term generally used in property policies to refer to furniture, machinery and finished
products:
A. Business personal property
B. Stock
C. Inventory
D. Commercial property
Rationale: Business personal property is the standard policy term for such items.
10. Family injured when roof collapsed; lawsuit finds builder liable. This is which liability
exposure for the construction company?
A. Products liability
B. Premises and operations liability
,ESTUDYR
C. Completed operations liability
D. Employers liability
Rationale: Injuries arising after construction is completed fall under completed
operations.
11. Which is an example covered by products & completed operations portion of CGL?
A. A defective gas range manufactured by the insured explodes causing injury.
B. Customer’s house set on fire while doing plumbing work
C. Defamation (slander) suit
D. Slip on wet floor in store
Rationale: Product defect causing injury is a products exposure.
12. Joe Motors wants to maintain customer goodwill. Best accomplished by:
A. Purchasing garage liability insurance.
B. Purchasing garagekeepers insurance.
C. Lowering physical damage deductible.
D. Raising liability limits.
Rationale: Garagekeepers covers customers’ vehicles under care, custody, control —
directly protects goodwill.
13. Workers compensation benefits include:
A. Death benefits of 100% of wage loss
B. Pain and suffering benefits
C. Rehabilitation benefits
D. Property damage benefits
Rationale: WC typically includes medical, wage replacement, and rehabilitation services.
14. An email with a harmful attachment leads to hackers obtaining customer contact info.
This cyber loss is:
A. Damage to intangible property.
B. Damage to personal property
C. Damage to tangible property
D. Errors and omissions liability
Rationale: Loss of customer data is damage to intangible property (information).
15. Web-based business: hacker deletes sales & contact data on server. Type of loss:
A. Tangible property
B. Personal injury
C. Intangible property
, ESTUDYR
D. Contingent business income
Rationale: Deleted records are intangible assets (data).
16. In property insurance, "personal property" refers to:
A. Property in transit
B. Contents in and around a building
C. Buildings not attached to main building
D. Company's copyrights and trademarks
Rationale: Personal property in property policies = contents/furnishings, i.e., business
personal property.
17. In business income insurance, expenses that would not have been incurred absent
interruption are called:
A. Continuing expenses
B. Contingent expenses
C. Excludable expenses
D. Extra expenses
Rationale: Extra expenses are incurred only because of the interruption to minimize
income loss.
18. Tire store installs wheels; wheel falls off causing crash. Tire store’s exposure is:
A. Employers liability
B. Completed operations liability
C. Automobile liability
D. Products liability
Rationale: Liability arising from completed service (installation) causing injury is
completed operations.
19. Loss exposures when business can be held liable for injury/damage caused by their
repair or contracting work:
A. Operations liability
B. Completed operations liability
C. Workers' compensation liability
D. Products liability
Rationale: Completed operations addresses liability after work is finished.
20. Inland marine insurance covers:
A. Businesses that own/operate watercraft
B. Many classes of property involving transportation on land
C. Companies shipping by inland waterways
