AINS 101 112 2026 EXAM SCRIPT TEST PAPER
QUESTIONS AND SOLUTIONS GRADED A+
◉ Premium.
Answer: the price of the insurance coverage provided for a specified
period
◉ Indemnify.
Answer: to restore a party who has sustained a loss to the same
financial position that party held before the loss occurred
◉ Insured.
Answer: any person or organization who is insured under an
insurance policy
◉ Property-casualty insurance.
Answer: one of the two main sectors of the insurance industry
encompassing numerous types of insurance, most of which cover the
financial consequences of damage to one's own property or legal
liability to others
◉ Life-health insurance.
,Answer: one of the two main sectors of the insurance industry
encompassing numerous types of insurance that cover the financial
◉ Stock insurer.
Answer: an insurer that is owned by its stockholders and formed as
a corporation for the purpose of earning a profit for the stockholders
◉ Mutual insurer.
Answer: an insurer that is owned by its policyholders and formed as
a corporation for the purpose of providing insurance to them
◉ Surplus-lines insurer.
Answer: a non-admitted insurer that is eligible to insure risks that
have been exported by a surplus lines licensee in accordance with a
surplus lines law
◉ Reinsurance.
Answer: the transfer of insurance risk from one insurer to another
through a contractual agreement under which one insurer (the
reinsurer) agrees, in return for a reinsurance premium, to indemnify
another insurer (the primary insurer) for some or all of the financial
consequences of certain loss exposures covered by the primary's
insurance policies
, ◉ Pure risk.
Answer: a chance of loss or no loss, but no chance of gain
◉ Speculative risk.
Answer: a chance of loss, no loss, or gain
◉ Solvency.
Answer: the ability of an insurer to meet its financial obligations as
they become due, even those resulting from insured losses that may
be claimed several years in the future
◉ Income statement.
Answer: the financial statement that reports an organization's profit
or loss for a specific period by comparing the revenues generated
with the expenses incurred to produce those revenues
◉ Earned premiums.
Answer: the portion of the written premiums that apply to the part
of the policy period that has already occurred
◉ Underwriting income.
Answer: income an insurer earns from premiums paid by
policyholders minus incurred losses and underwriting expenses
QUESTIONS AND SOLUTIONS GRADED A+
◉ Premium.
Answer: the price of the insurance coverage provided for a specified
period
◉ Indemnify.
Answer: to restore a party who has sustained a loss to the same
financial position that party held before the loss occurred
◉ Insured.
Answer: any person or organization who is insured under an
insurance policy
◉ Property-casualty insurance.
Answer: one of the two main sectors of the insurance industry
encompassing numerous types of insurance, most of which cover the
financial consequences of damage to one's own property or legal
liability to others
◉ Life-health insurance.
,Answer: one of the two main sectors of the insurance industry
encompassing numerous types of insurance that cover the financial
◉ Stock insurer.
Answer: an insurer that is owned by its stockholders and formed as
a corporation for the purpose of earning a profit for the stockholders
◉ Mutual insurer.
Answer: an insurer that is owned by its policyholders and formed as
a corporation for the purpose of providing insurance to them
◉ Surplus-lines insurer.
Answer: a non-admitted insurer that is eligible to insure risks that
have been exported by a surplus lines licensee in accordance with a
surplus lines law
◉ Reinsurance.
Answer: the transfer of insurance risk from one insurer to another
through a contractual agreement under which one insurer (the
reinsurer) agrees, in return for a reinsurance premium, to indemnify
another insurer (the primary insurer) for some or all of the financial
consequences of certain loss exposures covered by the primary's
insurance policies
, ◉ Pure risk.
Answer: a chance of loss or no loss, but no chance of gain
◉ Speculative risk.
Answer: a chance of loss, no loss, or gain
◉ Solvency.
Answer: the ability of an insurer to meet its financial obligations as
they become due, even those resulting from insured losses that may
be claimed several years in the future
◉ Income statement.
Answer: the financial statement that reports an organization's profit
or loss for a specific period by comparing the revenues generated
with the expenses incurred to produce those revenues
◉ Earned premiums.
Answer: the portion of the written premiums that apply to the part
of the policy period that has already occurred
◉ Underwriting income.
Answer: income an insurer earns from premiums paid by
policyholders minus incurred losses and underwriting expenses
