ARM 400 LATEST 2026 STUDY GUIDE QUESTIONS AND
ANSWERS MARKED A+
✔✔Internal control - ✔✔A system or process that an organization uses to achieve its
operational goals, internal and external financial reporting goals, or legal and regulatory
compliance goals.
✔✔Insurtech / Risk tech - ✔✔The use of emerging technologies in the insurance
industry.
Risk tech: Risk monitoring and mitigation tools. How to make risk financing more
efficient to include prevention and mitigation. Risk interactions generate big data —>
analytics
✔✔Sensor - ✔✔A device that detects and measures stimuli in its environment.
Detection is done on a continuous basis
Ex: thermometer that measures temperature and communicates to a display
-warning of impending problems or malfunctions
-can exist in a network
-smart sensors can auto shut down a machine or trigger an alarm
✔✔Preventive analytics - ✔✔Statistical and analytical techniques used to influence or
prevent future events or behaviors.
uses smart products and data analytics to identify root loss causes and their
implications
✔✔Connected Ecosystem - ✔✔The emerging technologies applied to risk assessment
and control link the physical domain to the virtual domain
✔✔The difference between risk tech and insurtech is - ✔✔Risk tech goes beyond
insurtech by expanding its focus to making risk financing more efficient and preventing
and mitigating losses in a variety of industries
✔✔Transducer - ✔✔A device that converts one form of energy into another. Specialized
sensor
✔✔Sensor Categories - ✔✔- mechanical
- thermal
- biochemical
- radiant
✔✔Digital Twin - ✔✔a virtual model designed to accurately reflect a physical object -
provides training opportunities without the risk for physical harm
✔✔Computer vision - ✔✔A technology that simulates human vision. Mimics the human
eye and involves detecting extracting and analyzing images to better understand them
, ✔✔Actuator - ✔✔A mechanical device that turns energy into motion or otherwise
effectuates a change in position or rotation using a signal and an energy source.
✔✔Accelerometer - ✔✔A device that measures acceleration, motion, and tilt.
✔✔Ergonomics - ✔✔The science of designing work space and equipment based on the
needs of the people who use the work space and equipment.
✔✔Stakeholder - ✔✔Any individual or organization that is directly or indirectly involved
with or affected by organizational decisions or activities.
✔✔Risk center - ✔✔A discrete unit within an organization, having a leader and specific
objectives, at which level a particular risk (or group of risks) is most appropriately and
effectively managed.
Benefit: Allows for participation by operational managers who may contribute to the risk
analysis.
✔✔Which one of the following types of risk is best handled at the risk center level? -
✔✔Minor risks that do not have consequences outside the unit are best managed at the
risk center level
✔✔An organization evaluates key stakeholders' attitude toward risk in order to -
✔✔Understand what risks are acceptable and to develop an effective enterprise-wide
risk management program
✔✔Risk owner - ✔✔An individual accountable for the identification, assessment,
treatment, and monitoring of risks in a specific environment.
✔✔Code of ethics - ✔✔The minimum standards of expected behavior for those to whom
the code applies.
The code of ethics should include principles and concepts that are dynamic enough to
remain relevant in a rapidly changing business environment.
✔✔Social responsibility - ✔✔An organization's responsibility to its stakeholders and
society to consider the consequences of its actions on all stakeholders and to protect
the welfare of society overall.
✔✔Key performance indicator (KPI) - ✔✔A measurement that defines how successfully
an organization is progressing toward its long-term goals. Quantifiable.
Many are lagging meaning they measure what has already occurred rather than
predicting what will occur.
ANSWERS MARKED A+
✔✔Internal control - ✔✔A system or process that an organization uses to achieve its
operational goals, internal and external financial reporting goals, or legal and regulatory
compliance goals.
✔✔Insurtech / Risk tech - ✔✔The use of emerging technologies in the insurance
industry.
Risk tech: Risk monitoring and mitigation tools. How to make risk financing more
efficient to include prevention and mitigation. Risk interactions generate big data —>
analytics
✔✔Sensor - ✔✔A device that detects and measures stimuli in its environment.
Detection is done on a continuous basis
Ex: thermometer that measures temperature and communicates to a display
-warning of impending problems or malfunctions
-can exist in a network
-smart sensors can auto shut down a machine or trigger an alarm
✔✔Preventive analytics - ✔✔Statistical and analytical techniques used to influence or
prevent future events or behaviors.
uses smart products and data analytics to identify root loss causes and their
implications
✔✔Connected Ecosystem - ✔✔The emerging technologies applied to risk assessment
and control link the physical domain to the virtual domain
✔✔The difference between risk tech and insurtech is - ✔✔Risk tech goes beyond
insurtech by expanding its focus to making risk financing more efficient and preventing
and mitigating losses in a variety of industries
✔✔Transducer - ✔✔A device that converts one form of energy into another. Specialized
sensor
✔✔Sensor Categories - ✔✔- mechanical
- thermal
- biochemical
- radiant
✔✔Digital Twin - ✔✔a virtual model designed to accurately reflect a physical object -
provides training opportunities without the risk for physical harm
✔✔Computer vision - ✔✔A technology that simulates human vision. Mimics the human
eye and involves detecting extracting and analyzing images to better understand them
, ✔✔Actuator - ✔✔A mechanical device that turns energy into motion or otherwise
effectuates a change in position or rotation using a signal and an energy source.
✔✔Accelerometer - ✔✔A device that measures acceleration, motion, and tilt.
✔✔Ergonomics - ✔✔The science of designing work space and equipment based on the
needs of the people who use the work space and equipment.
✔✔Stakeholder - ✔✔Any individual or organization that is directly or indirectly involved
with or affected by organizational decisions or activities.
✔✔Risk center - ✔✔A discrete unit within an organization, having a leader and specific
objectives, at which level a particular risk (or group of risks) is most appropriately and
effectively managed.
Benefit: Allows for participation by operational managers who may contribute to the risk
analysis.
✔✔Which one of the following types of risk is best handled at the risk center level? -
✔✔Minor risks that do not have consequences outside the unit are best managed at the
risk center level
✔✔An organization evaluates key stakeholders' attitude toward risk in order to -
✔✔Understand what risks are acceptable and to develop an effective enterprise-wide
risk management program
✔✔Risk owner - ✔✔An individual accountable for the identification, assessment,
treatment, and monitoring of risks in a specific environment.
✔✔Code of ethics - ✔✔The minimum standards of expected behavior for those to whom
the code applies.
The code of ethics should include principles and concepts that are dynamic enough to
remain relevant in a rapidly changing business environment.
✔✔Social responsibility - ✔✔An organization's responsibility to its stakeholders and
society to consider the consequences of its actions on all stakeholders and to protect
the welfare of society overall.
✔✔Key performance indicator (KPI) - ✔✔A measurement that defines how successfully
an organization is progressing toward its long-term goals. Quantifiable.
Many are lagging meaning they measure what has already occurred rather than
predicting what will occur.
