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AINS 103 (Business Insurance) Exam Test Questions and Answers Rated A
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AINS 103 (Business Insurance) Exam Test Questions and Answers Rated A
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AINS 103 (Business Insurance) Exam Test Questions and Answers Rated A1. Workers compensation benefits include which one of Rehabilitation
the following? benefits
2. When a clothing manufacturer decides to expand the Loss or damage
sale of its clothing line by offering internet purchases, caused by com-
it creates new exposures not otherwise covered, or puter viruses.
not fully covered, by a traditional policy. These in-
clude
3. Which one of the following supply chain exposures Loss of supply due
can a business mitigate by carefully wording con- to external events
tracts and diversifying suppliers?
4. The commercial property coverage part of a commer- A range of cov-
cial package policy contains one or more commercial ered peril
property coverage forms. Each coverage form typi-
cally includes all of the following, EXCEPT:
5. Which one of the following statements best describes The Special Form
the Causes of Loss—Special Form? provides coverage
for direct physi-
cal losses other
than those that
are specifically ex-
cluded.
6. Which one of the following best describes real prop- Tangible property
erty? that includes land,
structures perma-
nently attached to
the land, and
whatever is grow-
ing on the land.
7. During a business interruption, some of the organi- Payroll of key em-
zation's expenses, called continuing expenses, will ployees
continue, and other expenses, called noncontinuing
expenses, will not continue. Which one of the follow-
ing is an example of a continuing expense?
, AINS 103 (Business Insurance) Exam Test Questions and Answers Rated A
8. A vehicle owner had a tire store install four new Completed opera-
wheels and tires on the vehicle. On the way home tions liability.
from the store, one of the wheels came off, causing
the vehicle to accidentally run off the road and strike
a tree. The vehicle owner sued the tire store for failing
to properly tighten the lug nuts on the vehicle. The
loss exposure faced by the tire store in this case is
known as
9. Which one of the following entities would likely have Paul the plumber
the greatest completed operations loss exposure?
10. A carrier that is prevented by an accident from deliv- The compensa-
ering the cargo aboard its ship may face an exposure tion the carrier re-
called loss of freight, which is ceives for trans-
porting cargo.
11. Which one of the following statements is correct with If an occurrence
respect to the Building and Personal Property Cover- involves a loss that
age Form (BPP) deductible? affects more than
one category of
covered property
and a separate
limit of insurance
applies to each
category, losses to
all categories are
totaled and the de-
ductible applied to
that total amount.
12. Which one of the following statements is correct with Due to coverage
respect to the Building and Personal Property Cover- extensions, it is
age Form (BPP)? possible for the
total payment for
one loss to exceed
the policy limit.
13. Which one of the following would be considered an The increased
extra expense under the Business Income (and Extra cost of rent at
, AINS 103 (Business Insurance) Exam Test Questions and Answers Rated A
Expense) Coverage Form of the commercial package a temporary loca-
policy? tion
14. Dooley's Restaurant is insured under a commercial The policy's cov-
package policy (CPP) with the Business Income (with ered causes of
Extra Expense) Coverage Form. The business suf- loss did not in-
fered a $400,000 loss of business income when it was clude flood.
forced to suspend operations after flood waters dam-
aged the basement and first floor of the restaurant.
Which one of the following is an acceptable reason
for the CPP insurer to deny the business income
claim?
15. Lucy's Bakery is insured under a commercial pack- The salary of
age policy with the Business Income (and Extra Ex- the assistant bak-
pense) Coverage Form. A fire loss caused significant er and cake deco-
damage to the building. When Lucy learned that it rator
would take 9 months to repair the building, she decid-
ed to temporarily relocate to a nearby rental location.
All of the following would be considered covered ex-
tra expenses under the Business Income (and Extra
Expense) Coverage Form, EXCEPT:
16. Richard's Clothing Store has a $500,000 Business In- $100,000
come (and Extra Expense) Coverage Form on which
there is an 80 percent coinsurance clause. A fire
swept through the store. Richard's Clothing Store es-
timates that its net income plus all operating expens-
es for the policy period would have been $1,875,000.
The estimated business income loss is $300,000. How
much will the insurer pay?
17. Suzanne is a commercial lines underwriter. Which Endorsements
one of the following components of the general liabil-
ity coverage forms would she use to tailor the form to
meet the specialized needs of an insured?
18. Under Coverage A of the commercial general liability Infringement of
coverage form (CGL), property damage would include copyright
all of the following, EXCEPT:
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