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AFSB 153 ASSIGNMENT 1-9 AND A PRACTICE TEST WITH COMPLETE QUESTIONS AND CORRECT ANSWERS
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AFSB 153 ASSIGNMENT 1-9 AND A PRACTICE TEST WITH COMPLETE QUESTIONS AND CORRECT ANSWERS
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AFSB 153 ASSIGNMENT 1-9 AND A PRACTICETEST WITH COMPLETE QUESTIONS AND
CORRECT ANSWERS
ASSIGNMENT 1
Under a surety bond, the penal sum is the same as
The amount for which the bond is written.
Which one of the following is true regarding characteristics of commercial surety
bonds?
Nonstatutory bond obligations are determined by bond language and written contracts.
All of the following illustrate commonalities among all commercial surety bonds,
EXCEPT:
Coverage of additional parties is eliminated.
If a principal fails to perform its obligation to the obligee, which one of the
following parties must respond?
The surety
Which one of the following sections of a commercial surety underwriting
application details the principal's obligations that protect the surety?
The indemnity wording
A surety underwriter might require which one of the following, in addition to the
personal liability of the corporate owners or third parties, when underwriting a
hazardous bond?
Collateral
A surety will not provide a bond unless the underwriter is convinced that
,The principal can perform the obligation the bond guarantees.
Which one of the following surety types is likely to have studied the needs of
small market segments and adapted products to meet those needs?
Niche sureties
If a bond applicant requires more than one surety bond, which one of the
following steps must the producer take to help the applicant secure the required
bonds?
Assist the applicant in completing separate applications for each bond required
Which one of the following is one of the two marketing roles that surety bond
producers serve?
Locating sureties for clients
Which one of the following are advisory rates based solely on loss experience?
Loss costs
ASSIGNMENT 2
Sureties prefer to write
Continuous bonds with cancellation clauses.
Which one of the following is a method surety claims representatives can use to
address multiple claimants?
Interpleader action
Which one of the following is correct regarding compliance-only license and
permit bonds?
,Compliance-only license and permit bonds are the least hazardous for the surety, and
bond penalties are generally small.
Which one of the following is correct regarding forfeiture bonds?
In forfeiture, the surety pays the entire bond penalty.
Which one of the following is the obligee on state livestock dealers bonds?
The state
Which one of the following is correct regarding underwriting state agricultural
bonds?
Underwriters prefer that bond principals on state agricultural bonds be audited annually
by regulators.
Which one of the following is correct regarding the risk associated with milk
dealer bonds?
Milk dealer bonds are potentially hazardous as bond penalties can exceed $1 million
The obligee on a Packers and Stockyards Act bond is
The federal government.
Which one of the following correctly describes action an underwriter should take
regarding compliance-only contractors bonds?
Confirm that the contractor has property and liability insurance
Ralph is a producer who has been given a power of attorney by Grant Surety
Partners to write contractors license bonds. Which one of Ralph's actions would
likely be the most valuable to Grant's underwriters?
His prior knowledge of customers' character.
, The construction tradesperson who is required by a state, county, or municipality
to have a contractors license bond is the
Principal.
Which one of the following is correct regarding a customs bond?
The surety on a customs bond must be licensed by the Treasury Department.
Which one of the following is correct regarding sureties' period of liability on
customs bonds?
Sureties' liability may extend for years after cancellation of a continuous customs bond.
Randolph Importers has posted a continuous bond with the CBP for merchandise
it is receiving from Europe. The bonds provide coverage for any potential duties,
taxes, and penalties that may be assessed, but not collected, at the time of entry
of the merchandise. The duties, taxes, and fees for a 12-month period total
$480,000. Given this information, what is the bond's penal sum?
$50,000
Which one of the following insurance company employees is often required to
post a bond?
Adjuster
Which one of the following is a factor that lessens the underwriting risk for an
applicant for a collection agency bond?
A firm that deposits funds in Federal Deposit Insurance Corporation insured institutions
The obligee on a mortgage broker, banker, and lender bond is
The state, to hold it harmless for misconduct.
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