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AINS 102 Exam-Questions with Correct Answers/ Verified/ Latest Update (2024/2025)
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AINS 102 Exam-Questions with Correct Answers/ Verified/ Latest Update (2024/2025)
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AINS 102 Exam-Questions with Correct Answers/ Verified/ LatestUpdate (2024/2025)
Patrick's car is 12 years-old and has been driven for over 100,000 miles. He has decided that
instead of continuing to pay insurance premium for coverage for property damage to his
car, he will put the money aside to save for a new car. Which one of the following risk
management techniques is Patrick using?
Select one:
A. Diversification
B. Retention
C. Avoidance
D. Loss reduction - ✔✔B
Which one of the following statements regarding assets exposed to loss is true?
Select one:
A. Real property includes intangible property.
B. Earthquake damage to a swimming pool is an example of a personal property exposure.
C. Personal property includes only tangible property.
D. Lightning damage to a tree is an example of a real property loss exposure. - ✔✔D
Which one of the following is a form of compensatory damages?
Select one:
A. Punitive damages
B. Special damages
C. Exemplary damages
D. Real damages - ✔✔B
All of the following could lead to a liability loss for a family, EXCEPT:
Select one:
A. A guest slips on an icy sidewalk in front of the family's home and breaks his leg.
,B. The son, who is 13 years old, throws a rock at a classmate who requires stitches for an
injury to his head.
C. The father trips on a broom he left lying in the driveway and breaks his arm.
D. The daughter, who is 16 years old, sideswipes a neighbor's car and dents its fender while
driving her own car. - ✔✔C
States A, B, C, and D have addressed the problem of compensating auto accident victims
differently. Which one of the following most accurately describes the way that states are
handling this issue?
Select one:
A. State B has enacted a financial responsibility law that requires auto owners to carry auto
liability insurance at least equal to certain minimum limits.
B. State A, unlike most states, has enacted a compulsory auto insurance law, requiring
motorists to provide proof they have some means to pay for auto accident damages.
C. State D, a no-fault state, has enacted auto insurance covering accident victims on a first-
party basis, usually applying to bodily injury and not to property damage.
D. State C, a no-fault state, has enacted auto insurance covering accident victims on a first-
party basis, usually applying both to bodily injury and to property damage. - ✔✔C
Which one of the following statements is true regarding automobile insurance rating?
Select one:
A. State regulators require that all insurers offer discounts on auto rates for passive
restraints.
B. Most insurers base automobile rates on primary rating factors and do not consider any
other factors in establishing rates.
C. State regulators require that rates be adequate, reasonable, and not unfairly
discriminatory.
D. Drivers with lower-than-average loss exposure are charged higher rates. - ✔✔C
Which one of the following is true regarding the use of technology in home risk
management?
Select one:
, A. Data gathered from sensors is used by insurers for personalized pricing and claims
handling.
B. Smart devices in the home have reaffirmed the need for existing claims data to assess
risk.
C. Technology is more prevalent, abundant, and useful in homes than in automotive
environments.
D. Sensors are generally regarded as useful in loss prevention, but not in loss reduction. -
✔✔A
Rick and Jamie have chosen their first home and now are asking their insurance agent
Franklin to help advise them as to appropriate and affordable insurance coverage. Which
one of the following will most accurately reflect the best coverage choice for Rick and
Jamie?
Select one:
A. As Rick and Jamie will be buying a mansion, Franklin suggests an HO-5 comprehensive
form as it provides the highest dollar amounts of any coverage available.
B. As Rick and Jamie are buying and remodeling an older home, Franklin suggests an HO-8
modified coverage form to provide appropriate coverage for a building with a comparatively
high replacement cost.
C. As Rick and Jamie will be renting an apartment for a few years, Franklin suggests an HO-2
broad form as they will not need any dwelling coverage.
D. As Rick and Jamie are buying a residential condo, Franklin suggests the HO-3 special form
as they will be needing limited dwelling cove - ✔✔B
The definitions section of the Personal Auto Policy (PAP) uses
Select one:
A. Simple-to-understand language to define important words and phrases that are used
throughout the policy.
B. Legal terminology to help insureds understand how to file claims under the policy.
C. Technical language to explain insurance terminology to individuals who do not work in
the industry.
D. Complicated language to define important words and phrases that are used throughout
the policy. - ✔✔A
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