CPCU 500: Becoming a Leader in Risk Management and Insurance Exam Prep | Questions and Verified Answers| 100% Correct (Latest 2023/ 2024 Update)

CPCU 500: Becoming a Leader in Risk

Management and Insurance Exam Prep

| Questions and Verified Answers| 100%

Correct (Latest 2023/ 2024 Update)

Q: Loss Exposure

Answer:

Any condition or situation that presents a possibility of loss, whether or not an actual loss occurs

3 Elements of a Loss Exposure:

-An asset exposed to loss

-Cause of loss (peril)

-Financial consequences of that loss

Q: Types of Loss Exposures

Answer:

Property Loss

Liability Loss

Personnel Loss

Net Income Loss

Q: Hazard Classifications

Answer:

Moral

Morale

Physical

Legal

Q: Hazard

Answer:

A condition that increases the frequency or severity of a loss

Q: Moral Hazard

Answer:

A condition that increases the likelihood that a person will intentionally cause or exaggerate a

loss

Q: Morale Hazard (attitudinal hazard)

Answer:

A condition of carelessness or indifference that increases the frequency or severity of loss

Q: Physical Hazard

Answer:

A tangible characteristic of property, persons, or operations that tends to increase the frequency

or severity of loss

Q: Legal Hazard

Answer:

A condition of the legal environment that increases loss frequency or severity

Q: Property Loss Exposure

Answer:

A condition that presents the possibility that a person or an organization will sustain a loss

resulting from damage (including destruction, taking, or loss of use) to property in which that

person or organization has a financial interest

Q: Tangible Property

Answer:

Property that has a physical form

Q: Real Property (realty)

Answer:

Tangible property consisting of land, all structures permanently attached to the land, and

whatever is growing on the land

Q: Personal Property

Answer:

All tangible or intangible property that is not real property

Q: Intangible Property

Answer:

Property that has no physical form

Q: Liability Loss Exposure

Answer:

Any condition or situation that presents the possibility of a claim alleging legal responsibility of

a person or business for injury or damage suffered by another party

Q: Personnel Loss Exposure

Answer:

A condition that presents the possibility of loss caused by a person's death, disability, retirement,

or resignation that deprives an organization of the person's special skill or knowledge that the

organization cannot readily replace

Q: Personal Loss Exposure

Answer:

Any condition or situation that presents the possibility of a financial loss to an individual or a

family by such causes as death, sickness, injury, or unemployment

Q: Net Income Loss Exposure

Answer:

A condition that presents the possibility of loss caused by a reduction in net income

Q: Pre-Loss Goals

Answer:

Goals to be accomplished before a loss, involving social responsibility, externally imposed goals,

reduction of anxiety, and economy

Economy of Operations

Tolerable Uncertainty

Legality

Social Responsibility

Q: Post-Loss Goals