ARM 402 Exam – Questions & Proper Solutions (Pass!)
Reinsurers help primary insurers increase their large-line capacity by
Right Ans - Reinsurers help primary insurers increase their large-line capacity
by accepting liability for loss exposures that the primary insurer is unwilling
or unable to retain.
B. Accepting liability for loss exposures that the primary insurer is unwilling
or unable to retain.
Cold Coolers, Inc., has its main warehouse in St. Louis. It also stores inventory
in two warehouses in other cities to reduce the distance between their
warehouses and retail locations. Cold Coolers is using which one of the
following risk management techniques? Right Ans - A. Separation
The BIS created a capital requirement for large, global, systemically important
banks as part of its global liquidity framework under Right Ans - D. The
Basel III agreement.
The importance of systems relationships from a risk control and fleet safety
management perspective is that Right Ans - A. When a smaller system fails,
the larger system of which the smaller system is a part is more likely to fail.
Commercial general liability insurance policies written on an occurrence basis
apply to bodily injury and property damage that occurs during the policy
period. This provision supports the principle that insurable loss exposures
must ideally be Right Ans - A. Definite.
A major benefit of involving a special purpose vehicle (SPV) in a securitization
transaction is that investors can decide whether to invest in the securities
based on the Right Ans - C. Risk presented by the income-producing assets
held as collateral by the SPV.
"The contractor agrees to indemnify and hold harmless the owner against
claims, damages, bodily injury, or property damage arising out of the
contractor's work and caused by any act of omission of the contractor, his
agents, and his employees." This is an example of which one of the following
forms of a hold-harmless agreement? Right Ans - D. Limited form
, Which one of the following is a common problem with meetings that leaders
should try to avoid? Right Ans - B. Having the wrong people attend
Which one of the following major IT risks is likely to arise when an
organization's revenue stream falls? Right Ans - A. Project back-log
The unauthorized use of an individual's intellectual property is Right Ans -
D. Infringement.
Clark's Electronics is considering launching new technology for the medical
industry. Before investing major resources in the project, the company
decided to perform a SWOT analysis. The fact that there are new medical
industry regulations pending would fall under which one of the following
quadrants of a SWOT analysis? Right Ans - B. Threats
Which one of the following statements is correct with respect to risk
tolerance? Right Ans - B. Risk tolerance levels can have high-end
thresholds, low-end thresholds, or both.
A patent used for the invention of a machine is a Right Ans - D. Utility
patent.
Which one of the following commonly used categories of operational risk
includes risks associated with technology and equipment? Right Ans - D.
Systems
A primary loss prevention measure for contractual liability is to have most
contracts Right Ans - A. Reviewed by counsel before they are signed.
Treaty reinsurance Right Ans - B. Obligates the reinsurer to assume those
loss exposures that fall within the treaty.
Which one of the following methods can be used by a risk management
professional to provide high-level executives with the basic information
necessary to understand where a risk issue should be ranked among other
risk-related priorities? Right Ans - B. Dashboard reporting
Which one of the following statements is true regarding valuing intellectual
property? Right Ans - A. The value of a piece of intellectual property may
Reinsurers help primary insurers increase their large-line capacity by
Right Ans - Reinsurers help primary insurers increase their large-line capacity
by accepting liability for loss exposures that the primary insurer is unwilling
or unable to retain.
B. Accepting liability for loss exposures that the primary insurer is unwilling
or unable to retain.
Cold Coolers, Inc., has its main warehouse in St. Louis. It also stores inventory
in two warehouses in other cities to reduce the distance between their
warehouses and retail locations. Cold Coolers is using which one of the
following risk management techniques? Right Ans - A. Separation
The BIS created a capital requirement for large, global, systemically important
banks as part of its global liquidity framework under Right Ans - D. The
Basel III agreement.
The importance of systems relationships from a risk control and fleet safety
management perspective is that Right Ans - A. When a smaller system fails,
the larger system of which the smaller system is a part is more likely to fail.
Commercial general liability insurance policies written on an occurrence basis
apply to bodily injury and property damage that occurs during the policy
period. This provision supports the principle that insurable loss exposures
must ideally be Right Ans - A. Definite.
A major benefit of involving a special purpose vehicle (SPV) in a securitization
transaction is that investors can decide whether to invest in the securities
based on the Right Ans - C. Risk presented by the income-producing assets
held as collateral by the SPV.
"The contractor agrees to indemnify and hold harmless the owner against
claims, damages, bodily injury, or property damage arising out of the
contractor's work and caused by any act of omission of the contractor, his
agents, and his employees." This is an example of which one of the following
forms of a hold-harmless agreement? Right Ans - D. Limited form
, Which one of the following is a common problem with meetings that leaders
should try to avoid? Right Ans - B. Having the wrong people attend
Which one of the following major IT risks is likely to arise when an
organization's revenue stream falls? Right Ans - A. Project back-log
The unauthorized use of an individual's intellectual property is Right Ans -
D. Infringement.
Clark's Electronics is considering launching new technology for the medical
industry. Before investing major resources in the project, the company
decided to perform a SWOT analysis. The fact that there are new medical
industry regulations pending would fall under which one of the following
quadrants of a SWOT analysis? Right Ans - B. Threats
Which one of the following statements is correct with respect to risk
tolerance? Right Ans - B. Risk tolerance levels can have high-end
thresholds, low-end thresholds, or both.
A patent used for the invention of a machine is a Right Ans - D. Utility
patent.
Which one of the following commonly used categories of operational risk
includes risks associated with technology and equipment? Right Ans - D.
Systems
A primary loss prevention measure for contractual liability is to have most
contracts Right Ans - A. Reviewed by counsel before they are signed.
Treaty reinsurance Right Ans - B. Obligates the reinsurer to assume those
loss exposures that fall within the treaty.
Which one of the following methods can be used by a risk management
professional to provide high-level executives with the basic information
necessary to understand where a risk issue should be ranked among other
risk-related priorities? Right Ans - B. Dashboard reporting
Which one of the following statements is true regarding valuing intellectual
property? Right Ans - A. The value of a piece of intellectual property may
