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AINS 103 Practice Quiz-All Chapters Questions With Complete solution!!.
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AINS 103 Practice Quiz-All Chapters Questions With Complete solution!!.
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AINS 103: Practice Quiz-All Chapters Questions WithComplete solution!!
For .most .businesses, .which .peril .poses .the .greatest .risk .of .a .large .or .total .property .loss? .- .Correct .
Answer .- .For .most .businesses, .fire .poses .the .greatest .risk .of .a .large .or .total .property .loss.
Extra .expenses .are .expenses, .in .addition .to .ordinary .expenses, .that .an .organization .incurs .to .mitigat
e .the .effects .of .a .business .interruption. .Which .one .of .the .following .is .an .example .of .an .extra .expen
se? .- .Correct .Answer .- .Cost .to .rent .temporary .office .space.
An .electrical .contractor .was .hired .to .install .a .new .100-
amp .fuse .box .in .the .Smith's .home. .During .installation, .the .contractor .inadvertently .left .a .small .scre
wdriver .in .a .duct .space .behind .the .panel. .Three .weeks .later, .the .screwdriver .caused .an .electrical .sh
ort .which .led .to .a .fire. .Which .one .of .the .following .loss .exposures .best .categorizes .the .electrical .con
tractor's .legal .liability .exposure .for .the .fire .damages? .- .Correct .Answer .- .Completed .operations .liabil
ity.
Upon .entering .a .restaurant, .a .customer .grasped .a .handrail .that .broke .off, .causing .the .customer .to .f
all .and .break .his .wrist. .This .is .an .example .of .which .one .of .the .following .types .of .commercial .gener
al .liability .loss? .- .Correct .Answer .- .Premises .and .operations .liability.
Inland .marine .insurance .is .insurance .that .covers: .- .Correct .Answer .- .Many .different .classes .of .prope
rty .that .typically .involve .an .element .of .transportation .on .land.
Workers .compensation .benefits .include .which .one .of .the .following? .- .Correct .Answer .- .Rehabilitatio
n .benefits.
Bio-Pharma .was .a .highly-
regarded .pharmaceutical .company. .That .changed .last .year .when .it .was .revealed .that .Bio-
Pharma .researchers .had .fabricated .test .results .of .the .company's .new .hypertension .drug, .and .a .com
pany .official .bribed .a .key .regulator .to .get .the .drug .approved. .These .revelations .led .to .a .sharp .decli
ne .in .sales .of .all .of .Bio-Pharma's .drugs, .a .sharp .decline .in .net .income, .and .a .decline .in .Bio-
,Pharma's .stock .price. .This .scenario .clearly .indicates .the .value .of .a .corporation's...? .- .Correct .Answer
.- .Reputation.
When .a .clothing .manufacturer .decides .to .expand .the .sale .of .its .clothing .line .by .offering .internet .pu
rchases, .it .creates .new .exposures .not .otherwise .covered, .or .not .fully .covered, .by .a .traditional .polic
y. .These .include: .- .Correct .Answer .- .Loss .or .damage .caused .by .computer .viruses.
Sally .is .a .commercial .property .claims .adjuster. .When .she .is .first .assigned .a .claim, .she .reviews .the .c
ommercial .property .part .of .the .policy .to .make .sure .that .the .property .that .suffered .the .loss .matche
s .the .description .of .the .property .insured. .She .also .reviews .the .kinds .and .amount .of .coverage .provid
ed. .Which .one .of .the .following .components .of .the .commercial .property .part .will .provide .Sally .with .
this .information? .- .Correct .Answer .- .The .commercial .property .declarations .page .contains .informatio
n .such .as .a .description .of .the .property .insured, .the .kinds .and .amounts .of .coverage .provided, .and .a
ny .optional .coverages, .among .other .information.
Billy .owns .a .baseball .souvenir .store .in .Cooperstown, .NY. .He .insured .his .store .under .a .Building .and .
Personal .Property .Coverage .Form .(BPP) .with .a .$275,000 .limit .and .a .
$1,500 .deductible. .A .large .fire .in .the .store .caused .significant .damage .amounting .to .
$310,000 .in .covered .damages. .How .much .would .Billy's .insurer .pay .under .his .BPP? .- .Correct .Answer
.- .$275,000. .$310,000 .- .$1,500 .= .$308,500, .which .exceeds .the .BPP .limit. .The .insurer .will .pay .
$275,000. .The .deductible .is .subtracted .from .the .loss, .not .the .limit.
Which .one .of .the .following .is .one .of .the .covered .causes .of .loss .in .the .commercial .property .policy .C
auses .of .Loss—
Basic .form? .- .Correct .Answer .- .Explosion .is .a .covered .cause .of .loss .under .the .basic .form. .All .the .ot
hers .are .additional .causes .of .loss .covered .by .the .broad .form .
(and .they .are .also .covered .under .the .special .form).
Which .one .of .the .following .is .correct .with .respect .to .the .Increased .Cost .of .Construction .additional .c
overage .of .the .Building .and .Personal .Property .Coverage .Form .
(BPP)? .- .Correct .Answer .- .It .provides .a .small .amount .of .insurance .to .cover .the .increased .cost .to .co
mply .with .ordinances .or .laws .regulating .the .repair, .rebuilding, .or .replacement .of .covered .buildings.
Which .one .of .the .following .would .be .considered .an .extra .expense .under .the .Business .Income .
(and .Extra .Expense) .Coverage .Form .of .the .commercial .package .policy? .- .Correct .Answer .- .The .incre
ased .cost .of .rent .at .a .temporary .location.
Dooley's .Restaurant .is .insured .under .a .commercial .package .policy .(CPP) .with .the .Business .Income .
(with .Extra .Expense) .Coverage .Form. .The .business .suffered .a .
$400,000 .loss .of .business .income .when .it .was .forced .to .suspend .operations .after .flood .waters .dam
aged .the .basement .and .first .floor .of .the .restaurant. .Which .one .of .the .following .is .an .acceptable .re
ason .for .the .CPP .insurer .to .deny .the .business .income .claim? .- .Correct .Answer .- .The .policy's .covere
d .causes .of .loss .did .not .include .flood.
, Which .one .of .the .following .would .be .covered .under .the .Extra .Expense .insuring .agreement .of .the .B
usiness .Income .
(and .Extra .Expense) .Coverage .Form? .- .Correct .Answer .- .Costs .to .move .to .a .temporary .location.
Richard's .Clothing .Store .has .a .$500,000 .Business .Income .
(and .Extra .Expense) .Coverage .Form .on .which .there .is .an .80 .percent .coinsurance .clause. .A .fire .swep
t .through .the .store. .Richard's .Clothing .Store .estimates .that .its .net .income .plus .all .operating .expens
es .for .the .policy .period .would .have .been .$1,875,000. .The .estimated .business .income .loss .is .
$300,000. .How .much .will .the .insurer .pay? .- .Correct .Answer .- .
$100,000. .The .coinsurance .factor .would .be .the .amount .of .insurance .carried .
($500,000) .divided .by .the .amount .of .insurance .required .(80 .percent .of .
$1,875,000). .The .factor .is .1/3. .This, .multiplied .by .the .loss, .yields .$100,000 .that .the .insurer .will .pay.
Joe's .Cleaning .Service .is .having .a .very .good .year, .with .close .to .a .30 .percent .increase .in .sales. .Joe .is
.wondering .if .this .growth .will .affect .his .general .liability .premium .at .the .end .of .the .policy .period. .W
hich .one .of .the .following .sections .of .the .general .liability .coverage .form .will .provide .this .information
? .- .Correct .Answer .- .The .CGL .declarations .form .will .include .rating .and .premium .auditing .informatio
n.
A .customer .filed .a .suit .against .Patsy's .Market, .claiming .that .she .was .injured .when .she .slipped .and .f
ell .in .the .produce .section. .The .customer .claimed .that .she .broke .her .elbow, .had .to .have .surgery, .an
d .missed .a .week .of .work. .The .owner .of .Patsy's .Market .told .its .commercial .general .liability .
(CGL) .insurer .that .the .produce .area .was .always .clean .and .that .the .claim .was .suspicious. .After .revie
wing .the .medical .bills .and .video .footage .from .the .market, .the .insurer .concluded .that .Patsy's .Marke
t .was .probably .liable .for .the .customer's .injury. .The .CGL .insurer .will .most .likely .attempt .to .do .which
.one .of .the .following? .- .Correct .Answer .- .If .the .insurer's .investigation .revealed .that .Patsy's .Market .
was .liable .and .that .the .damages .were .covered .by .the .policy, .it .would .likely .try .to .negotiate .an .out .
of .court .settlement.
The .Commercial .General .Liability .
(CGL) .Coverage .Form .defines .the .term ."occurrence" .as: .- .Correct .Answer .- .An .accident, .including .co
ntinuous .or .repeated .exposure .to .substantially .the .same .general .harmful .conditions.
The .Commercial .General .Liability .(CGL) .Coverage .B—
Personal .and .Advertising .Injury .Liability .provides .coverage .for .which .one .of .the .following? .- .Correct .
Answer .- .The .definition .of .personal .and .advertising .injury .in .the .CGL .policy .includes .liability .arising .f
rom .false .arrest.
Injury .arising .out .of .which .one .of .the .following .offenses .could .be .covered .under .Coverage .B .of .the .
Commercial .General .Liability .policy? .- .Correct .Answer .- .Injury .arising .out .of .false .arrest .could .be .cov
ered .under .Coverage .B .of .the .Commercial .General .Liability .policy.
Shady .Stories, .a .tabloid .newspaper, .prints .a .false .story .about .a .local .politician. .Shady .knows .the .sto
ry .is .false .but .thinks .it .will .sell .a .lot .of .papers. .The .politician .claims .damages .from .Shady. .Shady's .C
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