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AINS 101
CORRECT SOLUTIONS.
Bill is an insurance producer for and employed by ABC Insurance Company (ABC). He represents only ABC when marketing insurance products, and uses an administrative staff also employed by ABC. Bill is a producer in the - correct answer- Direct writer marketing system
Because the insurance company usually determines policy wording and the insured has little choice but to "take it or leave it," an insurance contract is a - correct answer- Contract of adhesion
Which one of the following best explains why producers should be alert to changes in clients' loss exposures? - correct answer- Implemented risk management techniques may prove to be ineffective or become obsolete
At Greenfield Insurance Company, Bernadette and Rachel are corporate underwriters, and Tomas and Jose are field underwriters. All of the following are underwriting activities typically performed by corporate (or staff) underwriters like
Bernadette and Rachel, EXCEPT: - correct answer- Support
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Joel is the underwriter for Stanton Industries. He received a notice from the premium auditor on the account. After a recent visit to the insured's location, the auditor wanted to make Joel aware of a decline in the business and some questionable business practices. Which one of the following types of hazards is the auditor identifying? - correct answer- Moral hazards
Moral hazards - correct answer- include questionable business practices or a failing business.
James West is a claims rep with Hatters Insurance. As he learns how to handle a claim from start to finish, which one of the following best describes the correct order for him to follow during this process? - correct answer- Identifying the policy, calculating a loss reserve, determining the cause of loss, preparing a loss statement
Margaret was severely injured and scarred due to a recent accident. Which one of the following is an example of general damages Margaret received? - correct answer- Compensation for disfigurement
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Donna is an insurance producer. She makes an appointment with potential policyholder Sandie to review her loss exposures.She asks Sandie to complete a questionnaire to assist her in this effort. Donna is conducting a - correct answer- Risk management review
Rachel is a new employee of Westley Insurance, and has been asked to review some existing policies to become familiar with the types of policies she will be working with. Which one of the following will Rachel find is true as she conducts her review? - correct answer- Rachel finds the policy begins with a coverage overview and then goes into more coverage details.
Sports, Inc. is looking to obtain a commercial property policy on its building for $400,000. If their insurer decides to charge them a rate of $0.50 per $100 of building insurance, what premium must Sports, Inc. pay? - correct answer- $2,000
Destructive competition in the insurance industry could result in
- correct answer- Insurance shortages
The financial report for Hometown Insurer contains the
following information:
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