CISR PERSONAL LINES MISCELLANEOUS EXAM 2023-2024
ACTUAL EXAM 100 QUESTIONS AND CORRECT DETAILED
ANSWERS WITH RATIONALES |AGRADE
What is the Permitted Incidental Occupancies – Residence Premises HO
04 42 used for? – ANSWER- An other structure with an eligible
incidental “business” exposure typically offices, schools, or studios.
Rationale; The Limit of Liability & Description of Other Structure must
be shown in the Schedule.
Under a standard ISO Homeowners policy, what are the two Coverage C<\/p>\n\n\n\n
Liability for “business” (personal) property on the “residence premises”
to a maximum of $10,000.00.
What limit is the Special Limit of Liability automatically set to for
property away from the “residence premises” under the Increased Limits
on Business Property HO 04 12? – ANSWER- 60% of the limit of
property on the “residence premises.”
What does the Increased Limits on Business Property HO 04 12 not
provide coverage on? – ANSWER- 1 – “Business” property that pertains
to a “business” actually conducted on the “residence premises.”
2 – “Business” property in storage or held as a sample or for sale or
delivery after a sale.
What is the Permitted Incidental Occupancies – Residence Premises HO
04 42 endorsement used for? – ANSWER- Applies to personal property
used in the “business” described in the Schedule & removes the
$2,500.00 “business” limit for property on the “residence premises” for
furnishings, supplies, and equipment. Property other than furnishings,
supplies, and equipment is still limited to $2,500.00. Samples, inventory,
and items sold but not delivered are limited.
Under Coverage C – Personal Property, what are the three exclusions
that pertain to “business” property? – ANSWER- 1 – Property in an
apartment regularly rented or held for rental to others by an “insured.”<\/p>\n\n\n\n
2 – Business data including such data stored in items such as paper CISR RISK MANAGEMENT EXAM 2023-2024 ACTUAL Pure Risk – ANSWER- A chance of loss or no loss, but no chance of Incident – ANSWER- an event that disrupts normal activities and may Difference between expected losses and actual losses CISR ELEMENTS OF RISK MANAGEMENT EXAM The elimination of risk – ANSWER- Avoidance A situation, practice, or condition that may lead to an insured’s
records, computers, and related equipment.
3 – Credit cards, electronic fund transfer cards or access devices used
solely for deposit, withdrawal or transfer of funds.
What is the Landlord’s Furnishings HO 05 46 endorsement used for? –
ANSWER- To increase the Personal Property Limit to a maximum of
$10,000.00 on property regularly rented or held for rental to others by an
insured.
What does the Coverage E – Personal Liability Insuring Agreement
state? – ANSWER- The insurance company will provide coverage for a
claim against an “insured” for damages because of “bodily injury” or
“property damage” caused by an “occurrence” covered by the policy.
What does the Coverage F – Medical Payments to Others Insuring
Agreement state? – ANSWER- The insurance company will pay
necessary medical expenses incurred within three years from the date of
the accident causing “bodily injury.”
What are the exceptions to the “business” exclusion that give back both
personal liability and medical payments to others coverage for some
“business” activities? – ANSWER- 1 – The rental or holding for rental of
an “insured location” if on an occasional basis if used only as a
residence.
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EXAM 150 QUESTIOS AND CORECT DETAILED
ANSWERS WITH RATIONALES (VERIFIED ANSWERS)
|AGRADE
Risk Financing – ANSWER- The acquisition of internal and external
funds to pay losses at the most favorable cost.
Risk Financing Techniques – ANSWER- Risk Taking appetite, transfer
options, simple transfer options & loss sensitive transfer options
Risk Administration – ANSWER- the process of planning,
implementing, and monitoring the risk management program
Risk Management Information System – ANSWER- an information
system that supports both the risk team and the organization. This type
of software deploys risk management tools in addition to managing risk
data. RMIS can sometimes serve as a customer relationship module, as
well.
Four Components of the Total Cost of Risk – ANSWER- Insurance
Costs, Retained losses & ALAE, Risk Management departmental costs
and Outside service fees<\/p>\n\n\n\n
gain.
Speculative Risk – ANSWER- Chance of loss or gain, usually associated
with business or financial risk.
Exposure – ANSWER- a situation, practice, or condition that may lead to
an adverse financial consequence; an activity or asset.
Hazard – ANSWER- a condition that may give rise to a loss from a
given peril; physical, moral, or morale characteristics that increases the
likelihood of a loss.
Peril – ANSWER- the cause of loss, such as fire, wind, hail, slip and fall,
etc.
Severity – ANSWER- the dollar amount of a given loss or the aggregate
dollar amount of all losses for a given period.
Accidents are also evaluated according to how severe the ensuing injury
or property damage may be.
Frequency – ANSWER- the number of losses occurring in a given time
period. Accidents are evaluated according to how often they might
occur.<\/p>\n\n\n\n
become a loss (also referred to as a near miss)
Accident – ANSWER- an unplanned event definite as to time and place
that results in injury or damage to a person or property
Occurrence – ANSWER- an accident with the limitation of time
removed (an “accident” that is extended over a period of time rather than
a single observable happening)
Loss – ANSWER- a reduction in the value of assets. Not all losses
become claims
Claim – ANSWER- a demand for payment or an obligation to pay as a
result of a loss
Incurred but not reported (IBNR) – ANSWER- a reserve that must be
established for claims that have already occurred but that have not yet
been reported
Which of the following is not one of the components in the definition of
risk? – ANSWER- Chance or probability of loss
Certainty concerning a loss
Possibility of a variation of outcomes from a given set of circumstances<\/p>\n\n\n\n
Loss Trending – ANSWER- adjusting historical losses to account for
inflationary trends so that the ultimate value is more current or
meaningful. Loss trend factors are multiplied by actual historical losses
to trend the losses
Loss Development – ANSWER- the difference between the value of a
loss as originally reported and its subsequent evaluation at a later date or
at the time of its final disposition
Expected Losses – ANSWER- Loss projections (“loss pics” or “loss
picks”) based on probability distributions and statistics, frequently
developed using actuarial techniques including trending and
development.
Avoidance – ANSWER- eliminating an activity or exposure which
eliminates chance of loss
Prevention – ANSWER- breaks sequence of events that leads to a loss or
that makes the event less likely
Reduction – ANSWER- reducing the severity or financial impact from
unpreventable losses
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2023-2024 ACTUAL EXAM 150 QUESTIOS AND
CORECT DETAILED ANSWERS WITH RATIONALES
(VERIFIED ANSWERS) |AGRADE
An accident with the limitation of time removed; an “accident” extended
over a period of time rather than a single, observable event – ANSWERoccurrence
A condition or characteristic that may create or increase the likelihood or
severity of a loss – ANSWER- hazard
A response to a focus on the frequency with which events occur –
ANSWER- Prevention
The isolation of an exposure from other exposures, perils, or hazards –
ANSWER- Segregation
Creating asset back-ups – ANSWER- Duplication
A response to a focus on the severity of incidents in an effort to
recognize risk and take action to lower losses – ANSWER- Reduction
The shift of function, exposure, or responsibility of certain liabilities to
another party – ANSWER- Transfer<\/p>\n\n\n\n
The process of spreading exposures or activities over several locations –
ANSWER- Separation
Risk is defined as a condition of either positive or negative _ arising from a given set of circumstances – ANSWER- uncertainty Perceptions of risk depend upon an individual’s job function or area of expertise. – ANSWER- True A risk manager may define risk as the person or property exposed to a potential loss – ANSWER- True Pure risks include threats to property and people, as well as<\/em><\/strong> –
ANSWER- Liability
The result of a pure risk is some _ – ANSWER- Measure of Loss Unlike pure risk, presents the opportunity for gain – ANSWERSpeculative Risk
Speculative risk is associated with or _<\/em><\/strong> risk. – ANSWERBusiness, Financial<\/p>\n\n\n\n
susceptibility to adverse financial consequences or loss is called a(n) –
ANSWER- exposure
A _ is a cause of loss – ANSWER- peril A(n) _<\/em><\/strong> is a factor that increases the likelihood that a peril will occur.<\/p>\n\n\n\n