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AINS 103 (Business Insurance) All in One Study Exam Questions and Answers to Score 99%
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AINS 103 (Business Insurance) All in One Study Exam Questions and Answers to Score 99%
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AINS 103 (Business Insurance) All in OneStudy Exam Questions and Answers to
Score 99%
Coverage will apply under the liability insuring agreement of the Business
Auto Coverage Form (BACF) for bodily injury or property damage
Select one:
A. To a fellow employee.
B. Intended by the insured.
C. Caused by an accident.
D. Assumed by the insured.
Correct Answer -C. Caused by an accident.
Zelda has an automobile accident that is covered by a Business Auto
Coverage Form. The accident results in a pollution expense due to gasoline
spilling from the covered auto, as well as property damage and bodily
injury to a third party. The cost for the bodily injury is $1,000 along with
$2,000 property damage. The pollution clean-up cost is $5,000. Ignoring
any deductible that may apply, how much will Zelda's insurer pay for
these losses?
Select one:
A. $0
B. $1,000
C. $3,000
D. $8,000
Correct Answer -D. $8,000
,Part 2 of the Workers Compensation and Employers Liability Policy
requires which one of the following with respect to covered injuries?
Select one:
A. The injury must not result from employer negligence.
B. The injury must require medical treatment.
C. The injury must arise out of and in the course of the worker's
employment at one of the insured locations listed in the policy.
D. The injury must arise out of employment necessary or incidental to the
insured's work in a state or territory listed in the policy.
Correct Answer -D. The injury must arise out of employment necessary or
incidental to the insured's work in a state or territory listed in the policy.
Which one of the following statements is true about the basic differences
between excess and umbrella liability policies?
Select one:
A. An excess policy often drops down to provide additional coverage for
the insured, subject to a self-insured retention.
B. An umbrella offers not only high limits of liability, but also may provide
coverage not provided by the underlying insurance.
C. The self-insured retention in an excess liability policy becomes effective
when the insured fails to maintain the required underlying liability limits.
D. Umbrella liability policies cannot be written over excess policies, but
excess liability policies can be written over umbrellas.
Correct Answer -B. An umbrella offers not only high limits of liability, but
also may provide coverage not provided by the underlying insurance.
There are a number of reasons that organizations find that they need
excess or umbrella liability insurance. Which one of the following
statements most accurately describes how organizations go about
establishing their need for excess or umbrella liability insurance?
,Select one:
A. Insureds must first establish an accurate measure of their maximum
possible loss for liability exposures before they can even consider
purchasing umbrella or excess liability insurance.
B. Excess liability insurance is usually purchased as a supplement to an
existing primary insurance layer, while umbrella liability insurance is
usually used as a primary layer.
C. Insureds often purchase excess or liability insurance coverage because
their primary insurers are unwilling to provide adequate limits within the
primary insurance layer.
D. For those insureds that wish to increase their retentions, excess liability
insurance is more suitable for
Correct Answer -C. Insureds often purchase excess or liability insurance
coverage because their primary insurers are unwilling to provide adequate
limits within the primary insurance layer.
The owners of BB Hotel wanted to make sure that they were covered for
damage to the air conditioning and refrigeration equipment. In equipment
breakdown insurance, air conditioning and refrigeration equipment
includes components such as
Select one:
A. Coils.
B. Liquefied gas tanks.
C. Distribution panels.
D. Circuit breakers.
Correct Answer -A. Coils.
Which one of the following is a policy that covers the crime loss exposures
of financial institutions such as banks, savings and loan institutions, and
insurance companies?
, Select one:
A. Standard Form number 381
B. Fidelity bond
C. Commercial General Liability Crime Form
D. Financial institution bond
Correct Answer -D. Financial institution bond
The Grandfather Clock Company (GCC) ships clocks all over the U.S. It
ships frequently over 10,000 shipments each year and ships its goods by
common carrier. All of its shipping contracts say "FOB, buyer's address."
GCC believes that it needs insurance for the risk that its clocks will be
damaged during shipment. Which one of the following is the best
insurance advice for GCC?
Select one:
A. GCC doesn't need insurance—the common carrier is liable for all loss or
damage to the goods shipped by GCC.
B. GCC doesn't need insurance—the buyer assumes the risk of shipment.
C. GCC needs insurance and should obtain a trip transit policy.
D. GCC needs insurance and should purchase an annual transit policy.
Correct Answer -D. GCC needs insurance and should purchase an annual
transit policy.
Inland and ocean marine policies provide coverage for transportation loss
exposures. For an insured that would be considered an infrequent shipper,
which one of the following would be the best type of inland/ocean marine
insurance to cover this insured's shipping exposure?
Select one:
A. Open cargo insurance
B. Trip transit insurance
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