AINS 21 practice exam with 100% correct answers

AINS 21 practice exam with 100% correct answers when selecting a distribution channel, which one of the following is important consideration with regard to customer needs and characteristics - answer Which of the following statements is correct regarding characteristics of ideally insurable loss exposures - answerideally, loss exposures should be spread across a large number of similar exposure units within the same period The type of insurance that provides periodic income payments to an insured who is unable to work because of sickness or injury is - answerDisability income insurance Retention is often used in combination with insurance as a way of treating loss exposures. One of the major downsides of individuals using retention alone is - answerThe potential for financial ruin A loss exposure is - answerAny condition that presents the possibility of a loss Liability coverage for loss exposures arising from a business organizations premises and operations, its products, or its completed work is typically provided by - answerCommercial general liability insurance Though premiums are an obvious cost of insurance, many insureds believe that are too high because - answerBenefits are intangible until loss occurs Insurance is not the only risk management transfer technique. When circumstances are appropriate, transfer can be accomplished through - answernoninsurance transfer technique Which one of the following is an example of a fortuitous loss - answerAn unknown vandal spray-paints graffiti on the insured's garage Which one of the following statements is correct regarding the benefits that insurance provides - answerInvestment income helps keep insurance premiums at a reasonable level Claim buildup is considered to be among which one of the following costs of insurance - answerincreased losses The primary role of insurance is to - answerindemnify individuals and organizations for covered losses Coverage for money, securities, and other property from various causes of loss such as burglary, robbery, theft, and employee dishonesty typically is provided by - answercommercial crime insurance Which of the following is an opportunity cost of insurance - answerAn insureds funds that could be invested elsewhere if purchasing insurance were not necessary Coverage for miscellaneous types of property such as movable property, goods in domestic transit, and property use in transportation and communication, typically is provided by - answerinland marine insurance For insurers to utilize pooling most effectively and prevent catastrophic losses, the insured exposure units need to be - answerindependent Some loss exposures are not easy to retain, avoid, or control. What risk management techniques is frequently used to treat such exposures - answertransfer Sometimes the existence of insurance encourages losses. the result of this phenomenon is that in - answerincreases the total cost of insurance Pravalt Construction Company pays less than its competitors for workers compensation insurance because Pravalt has had substantially fewer employee injuries than other firms in its class. this illustrates which one of the following benefits of insurance - answerpromote risk control As a single mother on a very tight budget, Ciara is tempted to skimp on her insurance. However, her friend Mehmet tells her not to skimp on insurance, because it will help manage her cash flows. Which one of the following examples best illustrates Mehmet's point - answerWhen her car's windshield breaks, Ciara has to pay only $100 of the $600 cost of replacing it A small business owner concerned about something happening and not being able to work or earn a living for extended period of time due to an accident should purchase - answerDisability insurance Adhering to the characteristics of an ideally insurable loss exposure in selling insurance help assure that - answerThe insurer is able to charge a premium that the insured can afford to pay Which of the following statements is correct with regard to risk and ideally insurable characteristics of loss exposures - answerindemnification is the process of restoring an insured to pre-loss financial condition Which one of the following statements is correct - answerinsurers investment income helps keep premiums at reasonable