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

AINS 101 (Latest 2023/ 2024 Update)

Increasing Your Insurance IQ Exam|

Questions and Verified Answers| 100%

Correct| Grade A

Q: Rachel is a new employee of Westley Insurance, and has been asked to review some

existing policies to become familiar with the types of policies she will be working with. Which

one of the following will Rachel find is true as she conducts her review?

Answer:

Rachel finds the policy begins with a coverage overview and then goes into more coverage

details.

Q: Sports, Inc. is looking to obtain a commercial property policy on its building for $400,000.

If their insurer decides to charge them a rate of $0.50 per $100 of building insurance, what

premium must Sports, Inc. pay?

Answer:

$2,000

Q: Destructive competition in the insurance industry could result in

Answer:

Insurance shortages

Q: The financial report for Hometown Insurer contains the following information:

Earned premiums$4,000,000Written premiums$5,000,000Net investment

income$1,000,000Incurred losses$3,000,000Incurred underwriting expenses$2,000,000

What is Hometown Insurer's loss ratio?

Answer:

75%

Q: Loss Ratio

Answer:

incurred losses divided by its earned premiums

Q: Jessie is a new customer service representative (CSR) at the Winfield Agency. Jessie

usually engages in all the following activities, EXCEPT:

Answer:

Determining coverage quotes

Q: Riley Turner is performing a comprehensive evaluation of Hardwick Enterprises to make

sure its insurance and risk management efforts are serving the organization appropriately. Which

one of the following will be true in regard to this effort?

Answer:

Besides risk management goals being attainable, they should also pose a challenge.

Q: Rachel is considering investing in the stock of an insurance company. Which one of the

following is likely to provide the best indication of the insurer's financial position at this point in

time?

Answer:

Balance sheet

Q: Balance Sheet

Answer:

provides the best indication of its financial position because it shows admitted assets, liabilities,

and policyholders' surplus at a particular point in time.

Q: Which one of the following is the amount of business an insurer can write based on

regulatory guidelines, usually a comparsion of the insurer's written premiums to the

policyholders' surplus?

Answer:

Capacity

Q: The two main sectors of the insurance industry are

Answer:

Property-casualty insurance and life-health insurance

Q: The difference between an independent agency and an exclusive agency is that an

Answer:

Exclusive agency is contracted to sell insurance for one insurer or group of insurers

Q: A liability loss has the following damages:

Medical expenses:$10,000Damages for disfigurement:$50,000Damages for pain and

suffering:$100,000

What is the amount of special damages?

Answer:

$ 10,000

Q: Special damages