AINS 101 EXAM WITH COMPLETE QUESTIONS AND CORRECT
VERIFIED ANSWERS (DETAILED ANSWERS) ALREADY
GRADED A+ 100% GUARANTEED TO PASS CONCEPTS!!!.
Commercial crime insurance. - ANSWER-Coverage for money and other
business property from various causes of loss such as burglary, robbery, theft,
and employee dishonesty typically is provided by
Mutual Insurer - ANSWER-A type of insurer that is owned by policyholders and
may pay dividends to policyholders as a return of a portion of premiums paid is
a
Government programs can meet legitimate public demands unmet by private
insurers. - ANSWER-Which one of the following correctly describes a reason for
government involvement in property-casualty insurance?
Artificial Intel - ANSWER-If a fund manager violates the investment guidelines,
the computer immediately notifies MFC's internal control director, and
corrective action is taken. MFC's use of the computer algorithm to monitor
investment compliance and to provide notification when corrective action is
necessary illustrates use of
Speculative risk - ANSWER-Jimmy decided to buy a house in his neighborhood
that had been foreclosed on by the bank that held the mortgage. He is hoping
to do some renovation and repair work on the house, and then sell it for a
quick profit. Which one of the following types of risk is this for Jimmy?
,East Insurance comes up with a new rate structure allowing "preferred
customers" discounted policies when they continually renew year after year;
East eventually loses needed revenue but is rewarded by its competitors
leaving the market. - ANSWER-One of the reasons for insurance regulation is to
prevent destructive competition. In which one of the following scenarios would
destructive competition be exhibited?
Insurance regulation protects customers by guaranteeing insurance is available
and accessible to everyone who needs it. - ANSWER-Carlos is new to the
insurance business and is learning about insurance regulation and what he,
now working with Grady Insurance, will need to be aware of regarding the
subject of compliance. Which one of the following will Carlos find is accurate as
he better understands why insurance is regulated?
Solvency - ANSWER-What term refers to the ability of an insurer to meet its
obligations as they become due?
Total Liabilities - ANSWER-An insurer's financial statement shows a loss reserve
and an unearned premium reserve. These reserves are part of the insurer's
Risk - ANSWER-Which one of the following represents uncertainty about
outcomes that can be negative or positive?
Insureds share the cost of each other's losses. - ANSWER-Which one of the
following best describes the concept of pooling?
Personal property-casualty insurance policy. - ANSWER-A homeowners policy is
a type of
Select one:
Unearned Premiums - ANSWER-Which one of the following is part of written
premiums?
, Balance Sheet - ANSWER-Which one of the following types of financial
statements shows the financial position of an insurance company at any
particular point in time?
ometown Insurer's expense ratio is its incurred underwriting expenses
($2,000,000) divided by its written premiums ($5,000,000), or 40 percent. -
ANSWER-The financial report for Hometown Insurer contains the following
information:
Earned premiums $4,000,000
Written premiums $5,000,000
Net investment income $1,000,000
Incurred Losses $3,000,000
Incurred underwriting expense $2,000,000
The financial report for Hometown Insurer contains the following information:
Earned premiums$4,000,000Written premiums$5,000,000Net investment
income$1,000,000Incurred losses$3,000,000Incurred underwriting
expenses$2,000,000
What was the Hometown Insurer's combined ratio? - ANSWER-Hometown's
combined ratio equals its loss ratio ($3,000,000/$4,000,000) or 75 percent,
plus its expense ratio ($2,000,000/$5,000,000) or 40 percent, for a total of 115
percent.
The insurer is using its own employees as producers. - ANSWER-The key to the
direct writer marketing system is that
Is free to work with as many different insurers as it wants. - ANSWER-Spencer
Insurance Associates is an independent agency selling primarily homeowners
policies. This agency
