AU 60 Exam Practice Questions and
Answers
What is telematics? - Answer-A network of objects that transmit data wirelessly.
What is artificial intelligence (AI)? - Answer-Computer processing that simulates human
reasoning.
What is machine learning? - Answer-AI that teaches computers to make bet...
What is a market conduct examination? - Answer✔✔-Analysis of insurer's practices in
operational areas.
What is an employment relationship? - Answer✔✔-An agreement between an employer and
employee.
What is a professional employer organization (PEO)? - Answer✔✔-A company that leases
workers to client companies.
What is an independent contractor? - Answer✔✔-A person hired to perform services without
being controlled by the hirer.
What is a general contractor? - Answer✔✔-An independent contractor who obtains the primary
contract for a project.
What is a subcontractor? - Answer✔✔-An independent contractor engaged by a general
contractor to perform a portion of the contract.
What is pricing? - Answer✔✔-The process of setting a price and terms for an insurance
agreement.
What is a rate? - Answer✔✔-The price per exposure unit for insurance coverage.
What are loss costs? - Answer✔✔-The portion of the rate that covers projected claim payments
and expenses.
What is loss adjustment expense (LAE)? - Answer✔✔-The expense incurred by an insurer to
investigate, defend, and settle claims.
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