CPCU 520 PRACTICE EXAM ACTUAL QUESTION AND

CPCU 520 PRACTICE EXAM (ACTUAL / ) QUESTION AND

VERIFIED ACCURATE ANSWERS

Which one of the following statements is correct regarding the interaction between risk control and other insurer functions?

Select one:

• By making marginal accounts acceptable, risk control helps

the Claims Department settle losses.

• Risk control personnel are responsible for answering any

complex questions that insureds have about premium audits.

• Risk control representatives are responsible for compiling all

the information required for a premium audit.

• Risk control personnel can assist underwriters in modifying a

new applicant's loss exposures to meet eligibility requirements.

• --Answers----D. Risk control personnel can assist

underwriters in modifying a new applicant's loss exposures to meet eligibility requirements.

With respect to underwriting, it is an unfair trade practice to

Select one:

• Unfairly discriminate when selecting loss exposures.
• Misrepresent coverage in an application.
• Rebate premium to a policyholder. 1 / 4

• Misappropriate claim funds. - --Answers----A. Unfairly

discriminate when selecting loss exposures.

The state advisory organization has developed a new homeowners form which increases the personal property limits for guns, silverware, jewelry, and boats. Jancy Insurance Company is considering modifying the form for its own use.Which one of the following members of Jancy's staff would be involved in the research and development of this new form?

Select one:

• Clara, the underwriting manager
• Antonia, the accounting manager
• Merve, the claims manager
• Emma, the staff underwriter - --Answers----D. Emma, the

staff underwriter

The universal connectivity that allows people to interact with devices and for those devices to meaningfully interact with each other without human interaction is known as

Select one:

• Cloud computing.
• The blockchain.
• The Internet of Things. 2 / 4

• Telematics. - --Answers----C. The Internet of Things.

With regard to insurer licensing, a foreign insurer is an insurer

Select one:

• Licensed and operating in states other than its state of

domicile.

• Domiciled outside of the U.S. and licensed to transact business

in the U.S.

• Domiciled outside of the U.S. and operating as a nonadmitted

insurer.

• Licensed in the U.S. and transacting business outside the U.S.
• --Answers----A. Licensed and operating in states other than

its state of domicile.

The purpose of an activity log is to

Select one:

• Remind claim representatives to perform a particular task.
• Log all activities of a claim representative for billing purposes.
• Record all activities and analysis of a particular claim.
• Document a manager's review of a claim representative's

performance. - --Answers----C. Record all activities and analysis of a particular claim. 3 / 4

Which one of the following statements is true concerning the premium auditing process?

Select one:

• A premium auditor's job involves not only counting loss

exposures, but also classifying them correctly.

• The process the premium auditor uses is known as auditing

the policy because the focus is on the exposures identified on the policy.

• The definition of "employee" is the same for both workers

compensation and general liability policies when the premium base is payroll.

• An examination of the insured's books and records at the

insured's premises is referred to as a voluntary audit. - -- Answers----A. A premium auditor's job involves not only counting loss exposures, but also classifying them correctly.

Which one of the following is a claim control used to help meet regulatory compliance?

Select one:

• Special damages
• Annual Statements
• Access security
• / 4