AINS 101 COMPREHENSIVE EXAM SCRIPT 2026
COMPLETE QUESTIONS AND ANSWERS
● Insureds share the cost of each other's losses. Answer: Which one of
the following best describes the concept of pooling?
● Personal property-casualty insurance policy. Answer: A homeowners
policy is a type of
Select one:
● Commercial crime insurance. Answer: Coverage for money and other
business property from various causes of loss such as burglary, robbery,
theft, and employee dishonesty typically is provided by
● Mutual Insurer Answer: A type of insurer that is owned by
policyholders and may pay dividends to policyholders as a return of a
portion of premiums paid is a
● Government programs can meet legitimate public demands unmet by
private insurers. Answer: Which one of the following correctly
describes a reason for government involvement in property-casualty
insurance?
,● Artificial Intel Answer: If a fund manager violates the investment
guidelines, the computer immediately notifies MFC's internal control
director, and corrective action is taken. MFC's use of the computer
algorithm to monitor investment compliance and to provide notification
when corrective action is necessary illustrates use of
● Speculative risk Answer: Jimmy decided to buy a house in his
neighborhood that had been foreclosed on by the bank that held the
mortgage. He is hoping to do some renovation and repair work on the
house, and then sell it for a quick profit. Which one of the following
types of risk is this for Jimmy?
● East Insurance comes up with a new rate structure allowing "preferred
customers" discounted policies when they continually renew year after
year; East eventually loses needed revenue but is rewarded by its
competitors leaving the market. Answer: One of the reasons for
insurance regulation is to prevent destructive competition. In which one
of the following scenarios would destructive competition be exhibited?
● Insurance regulation protects customers by guaranteeing insurance is
available and accessible to everyone who needs it. Answer: Carlos is
new to the insurance business and is learning about insurance regulation
and what he, now working with Grady Insurance, will need to be aware
of regarding the subject of compliance. Which one of the following will
Carlos find is accurate as he better understands why insurance is
regulated?
, ● Solvency Answer: What term refers to the ability of an insurer to meet
its obligations as they become due?
● Total Liabilities Answer: An insurer's financial statement shows a loss
reserve and an unearned premium reserve. These reserves are part of the
insurer's
● Unearned Premiums Answer: Which one of the following is part of
written premiums?
● Balance Sheet Answer: Which one of the following types of financial
statements shows the financial position of an insurance company at any
particular point in time?
● ometown Insurer's expense ratio is its incurred underwriting expenses
($2,000,000) divided by its written premiums ($5,000,000), or 40
percent. Answer: The financial report for Hometown Insurer contains
the following information:
Earned premiums $4,000,000
Written premiums $5,000,000
Net investment income $1,000,000
Incurred Losses $3,000,000
Incurred underwriting expense $2,000,000
COMPLETE QUESTIONS AND ANSWERS
● Insureds share the cost of each other's losses. Answer: Which one of
the following best describes the concept of pooling?
● Personal property-casualty insurance policy. Answer: A homeowners
policy is a type of
Select one:
● Commercial crime insurance. Answer: Coverage for money and other
business property from various causes of loss such as burglary, robbery,
theft, and employee dishonesty typically is provided by
● Mutual Insurer Answer: A type of insurer that is owned by
policyholders and may pay dividends to policyholders as a return of a
portion of premiums paid is a
● Government programs can meet legitimate public demands unmet by
private insurers. Answer: Which one of the following correctly
describes a reason for government involvement in property-casualty
insurance?
,● Artificial Intel Answer: If a fund manager violates the investment
guidelines, the computer immediately notifies MFC's internal control
director, and corrective action is taken. MFC's use of the computer
algorithm to monitor investment compliance and to provide notification
when corrective action is necessary illustrates use of
● Speculative risk Answer: Jimmy decided to buy a house in his
neighborhood that had been foreclosed on by the bank that held the
mortgage. He is hoping to do some renovation and repair work on the
house, and then sell it for a quick profit. Which one of the following
types of risk is this for Jimmy?
● East Insurance comes up with a new rate structure allowing "preferred
customers" discounted policies when they continually renew year after
year; East eventually loses needed revenue but is rewarded by its
competitors leaving the market. Answer: One of the reasons for
insurance regulation is to prevent destructive competition. In which one
of the following scenarios would destructive competition be exhibited?
● Insurance regulation protects customers by guaranteeing insurance is
available and accessible to everyone who needs it. Answer: Carlos is
new to the insurance business and is learning about insurance regulation
and what he, now working with Grady Insurance, will need to be aware
of regarding the subject of compliance. Which one of the following will
Carlos find is accurate as he better understands why insurance is
regulated?
, ● Solvency Answer: What term refers to the ability of an insurer to meet
its obligations as they become due?
● Total Liabilities Answer: An insurer's financial statement shows a loss
reserve and an unearned premium reserve. These reserves are part of the
insurer's
● Unearned Premiums Answer: Which one of the following is part of
written premiums?
● Balance Sheet Answer: Which one of the following types of financial
statements shows the financial position of an insurance company at any
particular point in time?
● ometown Insurer's expense ratio is its incurred underwriting expenses
($2,000,000) divided by its written premiums ($5,000,000), or 40
percent. Answer: The financial report for Hometown Insurer contains
the following information:
Earned premiums $4,000,000
Written premiums $5,000,000
Net investment income $1,000,000
Incurred Losses $3,000,000
Incurred underwriting expense $2,000,000
