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CPCU 500 FINAL EXAM Questions with 100- Verified Answers Latest Updates 2024 GRADE A+
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CPCU 500 FINAL EXAM Questions with100% Verified Answers Latest Updates 2024
GRADE A+
Southwest Interstate Railroad (SIR) is concerned about the number derailments in recent years.
It's not cost effective to use human assets to inspect tracks, bridges, and trestles. Instead, SIR has
started to use drones. A drone can fly low over tracks and above/below bridges and trestles. The
drones record video that is transmitted to corporate headquarters where it is simultaneously
scanned for derailment hazards. In the past six months, the drones detected a track blockage
caused by a rock slide and damage to tracks in a remote area cause by an earthquake. SIR
dispatched work crews to make the tracks once again passable, and no derailments occurred.
SIR's use of drones, video, real-term video scanning, and computer analysis illustrates which one
of the following? correct answers Preventative analytics
Autonomous Vehicle Applications (AVA) is a start-up company that develops safety
technologies that can be sold to companies that are producing autonomous vehicles. One
technology AVA is developing allows an autonomous vehicle to detect, extract, and analyze
images; and then to respond to the images. For example, the technology would detect a presence
in a crosswalk, extract the image, and a computer would analyze the image. When the image was
determined to be a human being, the vehicle would slow down or stop until the crosswalk was
clear. This technology, which is designed to capture and analyze images, and to act on the
recognition of the image; is called correct answers Computer vision
In addition to metal detectors, many airports have installed a second type of scanning technology
for checked baggage and cargo. The checked bags and cargo pass through a portal with scanners
programmed to detect and test for explosive trace fumes. These scanners, which detect
explosives based on air samples, are an example of what type of sensor used for risk assessment
and control? correct answers Biochemical sensors
Last year, three Metro City firemen died responding to a fire at a chemical plant, when they were
overcome by toxic fumes. In response, Metro City is purchasing advanced first responder gear. It
includes special flame retardant suits with chemical and explosive fume sensors, air quality
sensors, and heat sensors. Responders will also wear special watches that will track a responder's
pulse, respiration, and blood pressure; and helmets that include video cameras. All of these
sensors will feed data to a computer in real-time. The computer will analyze the data and issue
threat levels and evacuation orders, if necessary. The protective gear Metro City will purchase
and the data transmission and analysis capability illustrate the use of correct answers Smart
products
AMRM Insurance Company sells insurance in Virginia, North Carolina, South Carolina, and
Georgia. The company has compiled a policyowner data base that can be used to send text
messages when hurricanes approach. The company provides early warnings, storm updates from
the National Weather Service, and hurricane safety measures. The company credits the system
,with reduced hurricane claims. The use of the texting system is an example of correct answers
Preventive analytics
Which one of the following statements is true with regard to preventive analytics? correct
answers Preventive analytics uses smart products and data analytics to identify root loss causes
and their implications.
Don is the Risk Manager for Rafferty Corporation. One of his peers, Sally, asks him one day,
"How do you define risk?" When Don replies, which one of the following statements is accurate?
correct answers Risk has different meanings within the risk management and insurance
communities.
The difference between risk tech and insurtech is correct answers Risk tech goes beyond
insurtech by expanding its focus to making risk financing more efficient and preventing and
mitigating losses in a variety of industries.
Catastrophes such as recent earthquakes and the 2011 tsunami in Japan pointed out a need for
many organizations to evaluate and manage their correct answers Supply-chain risk.
William is a risk manager for Green Mountain Trucking. He has always analyzed auto loss
frequency and severity rates for the fleet. William would like to collect data on vehicle speeds,
braking patterns, and distance traveled and compare that with the loss history. Which one of the
following would help William capture and analyze this data? correct answers Vehicle telematics
Which one of the following statements about the use of drones is true? correct answers Drones
may be equipped with cameras that relay data in real-time.
The traditional definition of risk management reflects the traditional concept of risk as correct
answers Negative
Take Your Order (TYO) is a company that specializes in taking product orders for vendors. The
manufacturer of a product can run a television or internet ad for a product with a toll-free
number. Customer calls for the products are routed to TYO, where one hundred operators are
available to receive the calls. Each operator is assigned a cubicle with a computer terminal, video
display monitor, and a telephone. TYO experienced high workers compensation claims from its
operators, claiming neck strain, eye strain, and wrist pain. In an effort to reduce such injuries,
TYO evaluated each operator's work area. The height of chairs and video monitors were
adjusted, curved computer keyboards and wrist-rests were provided, and the telephones were
replaced with audio headsets. Workers compensation costs dropped significantly. The science of
designing work spaces based on interaction between people and the equipment in the work space
is called correct answers Ergonomics
The emerging technologies applied to risk assessment and control link the physical domain to the
virtual domain. Together, these domains linked by the emerging technologies create a correct
answers Connected ecosystem
,The National Oceanic and Atmospheric Administration (NOAA), a U.S. Government agency,
monitors tsunami risk. Earthquakes under the sea often cause large waves which can have a
disastrous impact on coastal communities. In addition to monitoring earthquake data and tides,
NOAA recently added a new tool -- tsunami detection buoys. The buoys are placed in the sea
and they are equipped with sensors to detect high wave levels so that an early warning can be
given to a coastal area if an evacuation is needed. This application of the use of smart products
illustrates their use in correct answers Catastrophe management
Which one of the following data capture tools has led to an explosion of risk management
innovation by allowing smart products to transmit data to each other and to central hubs? correct
answers Internet of Things
A municipal water plant installed water flow sensors and water pressure sensors on the water
pipes leaving the plant. The sensors make sure water is flowing properly and that there are no
leaks or clogs which could produce a loss. These types of sensors are correct answers
Mechanical sensors
Many auto manufacturers have automated a portion of their assembly lines by introducing a
smart product. The smart product performs repetitive tasks, such as making the same weld on
each vehicle frame as it passes the smart product. These smart products, which can be fixed or
mobile, reduce repetitive motion injuries that humans might suffer. They can also be used to
perform dangerous tasks and in heavy-lifting jobs. These smart products are called correct
answers Robots
Mutual Fund Company (MFC) offers a wide array of mutual fund options to investors. Each
mutual fund has a different fund objective and set of investment guidelines that apply to the
fund. While MFC gives considerable freedom to its fund portfolio managers, they are required to
abide by the fund's investment guidelines. To monitor compliance, MFC developed a computer
algorithm. The computer algorithm continuously monitors each fund's compliance with
investment guidelines. 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 correct answers Artificial intelligence
Clear-Rite Company specializes in the clean-up of hazardous chemical spills. Workers
performing clean-up operations must use safety suits to prevent exposure to the chemicals. The
suits include pulse and respiration monitors, body temperature sensors, and chemical sensors.
The monitors and sensors report data to a mobile operations center which is deployed to each
clean-up site. The pulse and respiration monitors and the sensors that are part of the protective
gear are called correct answers Wearable technologies
Data Entry Company (DEC) offers customers data entry services. A customer can hire DEC to
enter survey data to be analyzed. Many DEC employees spend long hours entering data on a
computer. DEC has experienced neck strain and wrist pain complaints from their employees,
increasing the company's workers compensation costs. DEC investigated the complaints of its
data-entry employees. DEC adopted curved keyboards for data entry, wrist-rests for those
, entering data, and uniform chair heights and display monitor heights to reduce neck strain
claims. The science of designing work spaces based on the health concerns of those who will
operate in the work space is called correct answers ergonomics
Risk managers today differ from traditional risk managers in which one of the following ways?
correct answers They attempt to minimize threats and optimize opportunities.
In an effort to reduce expenses, increase profitability, and reduce human errors; ABC Insurance
Company decided to automate most of its personal lines underwriting function. The company
now uses standardized application forms that are submitted electronically to one of the
company's regional offices. At each regional office, a computer with a scanner reads the
applications. The computer has been programmed with acceptable answers to the questions. If
the answers on the application are all acceptable, the policy is automatically issued. Rejected
applications are automatically forwarded to a human underwriter who reviews them. The use of
this technology has reduced the company's expense ratio by two and a half percent, and reduced
the time it takes to issue a policy. ABC Insurance Company's use of computers to evaluate
applications electronically is an application of correct answers Artificial intelligence
Which one of the following is described as a distributed database that serves as a collectively
shared ledger? correct answers Blockchain
Which one of the following statements is true regarding the evolution of risk and risk
management? correct answers The definition of risk has evolved to include positive as well as
negative attributes.
Which one of the following is a tool that can be used by fraud investigators to compare
documents and analyze notes? correct answers Text mining
The relationship between which two basic measures is critical for risk management in assessing
risk and deciding whether and how to manage it? correct answers Likelihood and consequences
Which one of the following statements is true regarding the basic measures that apply to risk
management? correct answers Consequences measure the degree to which an occurrence could
positively or negatively affect an organization.
Risk can be classified as subjective or objective. Which one of the following statements is
correct with respect to these risk classifications? correct answers Subjective risk can exist even
where objective risk does not.
During the past year, International Toys has undertaken four capital projects. The company has
renovated and refurbished one of its aging warehouse buildings. It has purchased the most recent
version of its current order processing computer software. It has added two trucks to its fleet of
delivery vehicles. Lastly, it has purchased a new production machine that will allow it to launch
a new product line. Which one of the following company projects is the most speculative risk?
correct answers The new production machine
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