AINS 101 (Latest 2023/ 2024 Update) Increasing Your Insurance IQ Exam Prep| Questions and Verified Answers| 100% Correct

AINS 101 (Latest 2023/ 2024 Update)

Increasing Your Insurance IQ Exam Prep|

Questions and Verified Answers| 100%

Correct

Q: Pure risk

Answer:

a chance of loss or no loss, but no chance of gain

Q: Speculative risk

Answer:

a chance of loss, no loss, or gain

Q: Solvency

Answer:

the ability of an insurer to meet its financial obligations as they become due, even those resulting

from insured losses that may be claimed several years in the future

Q: Income statement

Answer:

the financial statement that reports an organization's profit or loss for a specific period by

comparing the revenues generated with the expenses incurred to produce those revenues

Q: Earned premiums

Answer:

the portion of the written premiums that apply to the part of the policy period that has already

occurred

Q: Underwriting income

Answer:

income an insurer earns from premiums paid by policyholders minus incurred losses and

underwriting expenses

Q: Balance sheet

Answer:

the financial statement that reports the assets, liabilities, and owner's equity of an organization as

of a specific date

Q: Policyholder's surplus

Answer:

an insurer's assets minus its liabilities, which represents its net worth

Q: Loss adjustment expenses

Answer:

the expense that an insurer incurs to investigate, defend, and settle claims according to the terms

specified in the insurance policy

Q: Assets

Answer:

types of property, both tangible and intangible, owned by an entity

Q: Liabilities

Answer:

financial obligations, or debts, owned by a company to another entity usually the policyholder in

the case of an insurer

Q: Investment income

Answer:

interest, dividends, and net capital gains received by an insurer from the insurer's financial assets,

minus its investment expenses

Q: Loss reserve

Answer:

an estimate of the amount of money the insurer expects to pay in the future for losses that have

occurred

Q: Unearned premium reserve

Answer:

an insurer liability representing the amount of premiums received from policyholders that are not

yet earned