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Exam (elaborations)

AU 61 Chapter 6 Exam Questions and Answers

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AU 61 Chapter 6 Exam Questions and Answers Which one of the following would be most important to an underwriter while underwriting a property risk and considering causes of loss that arise from exposure to the forces of nature? Select one: A. The geographical spread of risk B. Risk control ac...

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  • October 16, 2024
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  • 2024/2025
  • Exam (elaborations)
  • Questions & answers
  • 2024/2025
  • 2024/2025
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EMILLECT 2024/2025 ACADEMIC YEAR ©2024 EMILLECT. ALL RIGHTS RESERVED FIRST PUBLISH OCTOBER, 2024




AU 61 Chapter 6 Exam Questions and
Answers

Which one of the following would be most important to an underwriter while underwriting a

property risk and considering causes of loss that arise from exposure to the forces of nature?


Select one:


A. The geographical spread of risk


B. Risk control activity


C. Other lines of business written


D. Agency relationship - Answer✔✔-A. The geographical spread of risk


For commercial property insurance there are other major causes of loss in addition to fire.

When underwriting these other causes of loss the underwriter must first decide


Select one:


A. Which causes of loss present the greatest chance of frequency or severity.


B. What other lines of business this insurer presently has on its books for this risk.


C. Whether the cost to be charged for this risk is such that it is not an efficient use of the

underwriter's time.



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D. Which of the infrequent causes of loss is most likely to be the most important to underwrite.

- Answer✔✔-A. Which causes of loss present the greatest chance of frequency or severity.


Homeowner Susan Herman has been told by her insurance agent that her outdoor whole-house

generator and well pump are especially susceptible to lightning damage. Which one of the

following equipment types or protective devices would best serve to improve this exposure for

Susan?


Select one:


A. External fire detectors and alarms


B. Proper grounding


C. Service entrance protectors


D. Lightning rods - Answer✔✔-B. Proper grounding


The approach to measuring tornadoes is by evaluating the damage they cause. The Enhanced

Fujita Tornado Damage Scale was developed in the mid-2000s and reflects


Select one:


A. The use of accurate barometric pressure at 500 feet.


B. Five categories based on the maximum sustained wind.


C. Names and numbers of eighteen categories of wind.


D. The more localized nature of damage from tornadoes. - Answer✔✔-D. The more localized

nature of damage from tornadoes.
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, EMILLECT 2024/2025 ACADEMIC YEAR ©2024 EMILLECT. ALL RIGHTS RESERVED FIRST PUBLISH OCTOBER, 2024


Underwriters can use the Beaufort Wind Scale for reference purposes and to assess strong

windstorms. Which one of the following is the most widely used basis for the Beaufort Wind

Scale?


Select one:


A. As a measurement of hurricane force winds


B. As a classification of hurricanes


C. As an evaluation of the damage caused by tornadoes


D. As a basis for maritime wind advisories - Answer✔✔-D. As a basis for maritime wind

advisories


There are many methods of controlling flood losses. The most effective method of control is

which one of the following risk control measures?


Select one:


A. Not building in a flood plain


B. Erecting external dikes


C. Elevating equipment


D. Building strong walls - Answer✔✔-A. Not building in a flood plain


Underwriters can make recommendations to insureds for simple risk control measures to

manage riot, civil commotion, and terrorism loss exposures. To lessen the potential severity of

these type losses, underwriters can

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