CPCU ETHICS FINAL EXAM AND
PRACTICE NEWEST ACTUAL EXAM WITH
COMPLETE QUESTIONS AND ANSWERS
GRADED A | BRAND NEW!!!
Grace is a commercial lines producer at Midtown Insurance
Brokers. She submitted an application to Insurance Company
(IC) on behalf of a client. The underwriter at IC, Dave, is
concerned that the building is located in an undesirable, higher-
risk area of town. Dave explains his concerns to Grace and asks
her to personally inspect the client's premises and take
photographs to send to IC. Grace inspects the premises and
finds that the building is in poor repair, and the adjacent
buildings on both sides are old, wood-framed, and vacant.
There is evidence that street people are living in one. Grace
carefully takes photographs of the most flattering views of her
client's building and sends them to Dave. She feels she wants to
do the best she can for her client, so she does not tell Dave that
the building is in poor repair or even mention the adjacent
buildings. - ✔✔✔ Correct Answer > D. Grace's actions have
harmed IC and as a result she has contravened Canon 3.
,Jerry is a claim representative with Insurance Company. His
wife, Margie, is a dental hygienist at Midtown Dental Clinic. One
day, Jerry's supervisor assigns him a small theft claim submitted
by Midtown Dental Clinic. Under Canon 1—Altruism of the
Ethical Guidelines for Insurance Professionals, which one of the
following would be Jerry's best course of action?
Select one:
A. Deny the claim so as to avoid appearing to benefit Margie's
employer.
B. Have Margie ask her employer to withdraw the claim.
C. Ask his supervisor to assign the claim to another claim
representative.
D. Pay the claim based on the facts and merits of the case. -
✔✔✔ Correct Answer > C. Ask his supervisor to assign the
claim to another claim representative.
Sanjay is a claims representative for Dutiful Insurance Company.
A policyholder is sued by a third party for an at-fault accident. If
he acts according to high ethical standards, which one of the
following should be Sanjay's primary goal?
Select one:
A. To attempt to discredit the third party
B. To protect the policyholder from out-of-pocket loss
,C. To protect Dutiful from reputational damage
D. To minimize the claim amount to be paid by Dutiful - ✔✔✔
Correct Answer > B. To protect the policyholder from out-of-
pocket loss
Milo is creating a chart for his fellow business analysts at the
insurer where he works. The chart will show the major groups
to which insurance professionals owe ethical responsibilities,
which are
Select one:
A. Policyholders, additional insureds, and the public.
B. Insurers, policyholders, and the public.
C. Insurers, policyholders, and additional insureds.
D. Policyholders, insurers, and the federal government. - ✔✔✔
Correct Answer > B. Insurers, policyholders, and the public.
Which one of the following statements is correct?
Select one:
A. Insurance professionals have a responsibility to insure any
and all risks, regardless of the effect this has on insurer
profitability.
, B. Agents are paid on a commission basis because their
responsibility to insurers is to sell as many policies as possible.
C. Claim representatives should carefully determine the value of
each claim and never pay insureds or claimants more than that
value.
D. Underwriters must balance the customer's need for a fair
price and comprehensive coverage with the insurer's profit
goals. - ✔✔✔ Correct Answer > D. Underwriters must balance
the customer's need for a fair price and comprehensive
coverage with the insurer's profit goals.
Oliver is a reinsurance intermediary placing reinsurance for a
variety of insurers with a variety of reinsurers. He has no
contact with the public or policyholders of the insurers for
which he places reinsurance. In this position, Oliver's duties are
best characterized by which one of the following?
Select one:
A. Oliver still has significant duties to the public and primary
insurer policyholders.
B. Oliver owes his primary duties to the insurance regulators
overseeing reinsurance.
C. Oliver only owes his duties to the insurers for which he places
business and the reinsurers.
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