AINS 101 - Course Quiz – 50 Questions with Answers 2024
The primary role of insurance is to - Answer- Indemnify individuals and organizations for covered losses.
As a single mother on a very tight budget, Ciara is tempted to skimp on her insurance. However, her friend Mehmet tells her not to...
AINS 101 - Course Quiz – 50 Questions with Answers 2024
The primary role of insurance is to - Answer- Indemnify individuals and organizations for
covered losses.
As a single mother on a very tight budget, Ciara is tempted to skimp on her insurance. However,
her friend Mehmet tells her not to skimp on insurance, because it will help manage her cash
flows. Which one of the following examples best illustrates Mehmet's point? - Answer- When
her car's windshield breaks, Ciara has to pay only $100 of the $600 cost of replacing it.
A homeowners policy is a type of - Answer- Personal property-casualty insurance policy.
Coverage for money and other business property from various causes of loss such as burglary,
robbery, theft, and employee dishonesty typically is provided by - Answer- Commercial crime
insurance.
Which one of the following describes the characteristics of a mutual insurance company? -
Answer- A corporation owned by policyholders that provides insurance to its policyholders.
An insurer that was formed for the purpose of earning a profit for its stockholders is a - Answer-
Stock insurer
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 - Answer- Computer vision
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 - Answer- Artificial intelligence
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? - Answer- Insurance regulation protects customers by guaranteeing
insurance is available and accessible to everyone who needs it
One of the reasons for insurance regulation is to prevent destructive competition. In which one of
the following scenarios would destructive competition be exhibited? - Answer- 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.
What term refers to the ability of an insurer to meet its obligations as they become due? -
Answer- Solvency
An insurer's financial statement shows a loss reserve and an unearned premium reserve. These
reserves are part of the insurer's - Answer- Total liabilities.
Admitted assets are types of property that regulators allow insurers to show as assets on their
financial statements because they are - Answer- Easily converted to cash
Which one of the following is a nonadmitted asset? - Answer- Office equipment
The financial report for LMN Insurance contains the following information:
Earned premiums $8,000,000Written premiums $10,000,000Incurred losses $6,000,000Incurred
underwriting expenses $4,000,000
What is LMN Insurance's expense ratio? - Answer- 40%
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller chrismaishndirangu. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $16.39. You're not tied to anything after your purchase.
