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AINS 103 | 50 Question with 100 % Verified Solutions
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Danforth Grocery Store specializes in fresh produce and is open 24 hours year-round. The store has contracts with suppliers to deliver produce and foods by 5am daily, so the parking area at the rear of the store is congested from 4:30am to 5:30am. Customer traffic is heaviest from 7am to 9am, and again from 3pm to 6pm. The store has had six slip and fall claims from customers in the past year. Danforth Grocery Store is most exposed to which one of the following types of liability loss? A. Completed operations liability B. Premises liability C. Automobile liability D. Professional liability - ✔✔B. Premises liability Entities eligible for financial institution bonds are A. Not eligible for for the ISO Commercial Crime Program B. Insured by the Federal Deposit Insurance Corporation (FDIC) C. Required to carry the ISO Commercial Crime Form D. Excluded under the Commercial General Liability Crime Form - ✔✔A. Not eligible for for the ISO Commercial Crime Program Smith Stores had net income of $5,000 per month in the 12 months before a covered business income loss. The store is unable to reopen for three months. During that time, continuing expenses totaled $6,000. What is the amount of Smith Stores' business income loss? A. $6,
B. $15,
C. $21,
D. $66,000 - ✔✔C. $21,
The business was interrupted for three months, for a business income loss of $15,000, plus continuing expenses of $6,000. The Malvern Company is a small business insured under a BOP for both building and BPP. Which one of the following would be covered under the definition of a building under the company's BOP? A. Product manufactured by Malvern Company B. The land that the building sits on C. Air conditioning equipment attached to the building D. The fence that surrounds the building - ✔✔C. Air conditioning equipment attached to the building The Workers Compensation and Employers Liability Insurance Policy provides that the insured is responsible to reimburse the insurer to which one of the following situations? A. Any benefits paid by the insurer even though the insured has failed to comply with policy conditions B. Benefits paid to employees with pre-existing injuries C. Penalties levied under a workers compensation law against the insured for noncompliance with health and safety laws and regulations D. A liability suit was filed against the insured for occupational injuries to employees - ✔✔C. Penalties levied under a workers compensation law against the insured for noncompliance with health and safety laws and regulations
An intangible asset resulting from a collection of perceptions and opinions, past and present, about an organization that resides in the consciousness of its stakeholders is known as an organization's A. Intellectual property B. Social responsibility C. Reputation D. Code of ethics - ✔✔C. Reputation Which of the following policies would respond to a furnace explosion? A. Equipment breakdown B. BOP C. Office equipment and systems policy D. Commercial property policy - ✔✔D. Commercial property policy Sugartown Industries insures its building and personal property under the commercial property coverage part of a CPP. Following a lightweight storm, a portion of the building was damaged from a small fire. The operations manager pulled out the CPP to make sure that the building was covered for this type of loss. Which one of the following components of the commercial property coverage part would provide the operations manager with information on the covered perils? A. Conditions B. Declarations C. Causes of loss form D. Building and personal property coverage form - ✔✔C. Causes of loss form
To what extent are extra expenses covered under the ISO Business Income Coverage (without Extra Expense) Coverage form? A. To the full extent of the expenses incurred by the insured B. Only to the extent that they actually reduce business income loss C. On an actual cash value basis D. On a replacement cost basis as long as the coinsurance requirement is met - ✔✔B. Only to the extent that they actually reduce business income loss Which of the following best describes an advantage to insurers of non filed classes compared with filed classes of inland marine insurance? A. Nonfiled classes allow for the customization of policy provisions and rates for a small number of individual insureds B. Nonfiled classes are characterized by relatively homogenous loss exposures C. Nonfiled classes are characterized by relatively large number of potential insureds D. Nonfiled Classes are the same in all states - ✔✔A. Nonfiled classes allow for the customization of policy provisions and rates for a small number of individual insureds Which one of the following causes of loss is covered by the commercial property policy causes of loss - broad form but not the basic form? A. Windstorm or hail B. Aircraft or vehicles C. Falling objects D. Lightning - ✔✔C. Falling objects
D. Continuing property taxes for corporate headquarters - ✔✔A. Costs to move office equipment to a substitute location A private company posted a video on the internet including a new product. The music used in the video was from a copyrighted song. When the company sought coverage under Part B of their Commercial General Liability Coverage Form after a claim was filed against them for damages, coverage will most likely be excluded based on which one of the following exclusions? A. Unauthorized use of another's name or product in a chat room exclusion B. Insureds in media and internet-type business exclusion C. Knowing violation of rights of another exclusion D. Coverage for infringement of copyright, patent, or trade secret are excluded unless it occurs in an advertisement exclusion - ✔✔D. Coverage for infringement of copyright, patent, or trade secret are excluded unless it occurs in an advertisement exclusion Joshua owns a mid-sized contracting company and was considering a job on a multimillion dollar project. Due to the size of the project, Joshua had difficulty determining the maximum possible loss. Considering the size of the project, Joshua should do which of the following? A. Purchase excess limits provided by an excess or umbrella liability policy B. Consider separate premises and product liability policies C. Implement a liability deductible D. Pay for extensive loss control resources to avoid hazardous losses while on the job - ✔✔A. Purchase excess limits provided by an excess or umbrella liability policy The Jackson Motor Company is a commercial trucking company that provides shipment services for a number of manufacturers throughout the US. It has a good safety record, but believes that it
needs insurance to protect it from its possible legal liability for damage to the cargo of its customers during shipment by its vehicles. Which one of the following inland marine insurance policies is most appropriate for JMC? A. Motor truck cargo liability B. Annual transit C. Contractor's equipment floater D. Trip Transit - ✔✔A. Motor truck cargo liability In order for an insurer to be obligated to pay damages under a BOP for a liability claim three conditions must be met. All of the following are conditions for a liability claim under the BOP, except: A. The insured must be legally obligated to pay the claim B. The policy must apply to the occurrence C. The insured must have known about the incident before the policy went into effect D. The damages must result from bodily injury or property damage or personal and advertising injury - ✔✔C. The insured must have known about the incident before the policy went into effect The claims manager for Providence Mall knows the longer liability claims are open, the higher the demand and claims cost. The manager wants to use data analytics to predict the final settlement amount if bodily injury claims that are open over two years. The manager would also like to examine how much the amount varies based in the different areas in the mall and which stores have claims from injury occurring within the store. Which one of the following methods would help predict the cost of the claims with those attributes? A. Fraud analysis
C. $305,
D. $320,000 - ✔✔D. $320,
It will pay the full award of $285,000 because it is below the $300,000 per occurrence limit of insurance. It will also pay the full amounts for the prejudgment interest and the defense costs because they are supplementary payments and are payable in addition to the limit of insurance Sandy owns a small retail store. Sandy's store is covered under a BOP with a $500,000 limit of insurance for its BPP and $1,000 deductible. Sandy did not purchase any optional coverages. A fire broke out in a neighboring store, and spread to Sandy's store. Sandy claimed the following damages: Cash in a money drawer $5, Damage to the building $50, Damage to a computer and printer in the office area $15, Damage to a personalized sign attached to the building $1, How much will the BOP insurer pay for this loss? A. $50, B. $65, C. $66, D. $71,500 - ✔✔B. $65, The fire is an insured cause of loss. The outdoor sign is covered for up to a maximum of $1, because it is attached to the building. The cash is not covered under a BOP policy. The deductible IS subtracted from the loss amount
Ava is Regional Manager for Goshen Mutual. She is looking over the past auto losses for Disposal Inc. She is tracking the experience of their drivers, the location of accidents, and the severity of the injury to their employees and the public. She is trying to determine the frequency and severity of the auto exposure for Disposal and to use the future models to suggest where Disposal allocates their loss prevention resources. Which one of the following forms of analysis is Ava using to help Disposal address their auto exposure? A. Internet of things B. Predictive modeling C. Data mining D. Smart products - ✔✔B. Predictive modeling Predictive modeling blends past data with multiple variable to create models of anticipated future outcomes An animal damaged the interior of an insured's automobile while it was parked with the windows down. Which one of the following types of physical damage coverage under the Business Auto Coverage Form (BACF) would cover this loss? A. Towing and labor B. Comprehensive C. Collision D. Specified perils coverage - ✔✔B. Comprehensive Comprehensive coverage applies to any peril except collisions or overturn or a peril specifically excluded
B. Sara is a volunteer helping the named insured clean up their grounds C. Tamara is hired by the named insured to do work for a tenant of the insured D. Kevin fractured his elbow while playing in a volleyball contest against another local company
- ✔✔B. Sara is a volunteer helping the named insured clean up their grounds During a business interruption, some of the organization's expenses, called continuing expenses, will continue, and other expenses, called non continuing expenses, will not continue. Which one of the following is an example of a continuing expense? A. Overtire wages to employees B. Cost to rent temporary office space C. Cost of overnight air shipment of needed repair parts D. Insurance premiums - ✔✔D. Insurance premiums Sam is a risk manager and is reviewing his insurance program and coverage options with his insurance broker. Because of fluctuations in sales due to seasonal marketing promotions, the insurance broker recommends adding Inflation Guard optional coverage to Sam's Building and Personal Property Coverage Form (BPP). If Sam adds Inflation Guard as an optional coverage which of the following is true? A. It leaves policy limits unchanged while increasing the annual premium by the rate of inflation B. It is available only on business personal property C. It automatically increases the limit of insurance by the percentage of annual increase shown in the declarations D. It is automatically added whenever the Agreed Value optional coverage is added - ✔✔C. It automatically increases the limit of insurance by the percentage of annual increase shown in the declarations
Lawn Chemical Company applied fertilizer and weed killer to lawns and shrubs. Which one of the following is a liability loss exposure to which Lawn Chemical Company has a significant exposure? A. Professional B. Premises C. Completed operations D. Vicarious - ✔✔C. Completed operations Marlene is a producer for East Goshen Mutual. She recently met with the owners of Sugartown Farms to try and determine if they are eligible for the ISO BOP. Which one of the following facts about Sugartown Farms would prevent it from being eligible for the BOP? A. Sugartown Farms has a total floor area of 4000 square feet B. Sugartown Farms is a three-story structure C. Sugartown Farms has a restaurant with a bar for local patrons D. Sugartown Farms has three rooms available for rental units on the property - ✔✔C. Sugartown Farms has a restaurant with a bar for local patrons There can be adverse financial consequences following the loss of or damage to property including a reduction in property value. Which one of the following statements is correct with to a reduction in value? A. A rare glass statue that is repaired after being damaged is likely to have declined in value B. When property is lost or destroyed, the limit of insurance is deemed to be the amount of the reduction in value
John's Hardware store is located along Main Street in a section dedicated to small businesses. One day a new employee was helping a customer fill their propane cylinder when an explosion occurred damaging a number of vehicles, injuring the customer and the new employee, and damaging the adjoining business. John's employee was found to be at fault for the explosion. Which one of the following would be covered under John's Coverage A of the CGL policy? A. The slander suit falsely accusing the customer of manipulating the propane cylinder before John's employee attempted to fill it B. The injury to John's customer C. The property damage to John's hardware store D. The burns suffered by John's new employee - ✔✔B. The injury to John's customer Owen is a producer tasked with helping XYZ Products identify their supply chain risk. Owen suggested XYZ create a flowchart detailing the movement of their products. The purpose of creating a flowchart to identify supply chain risk would be which one of the following? A. Looking at the process visually can help the client develop appropriate risk management techniques, such as finding an alternative supplier B. Flowcharts help locate the lowest price for products C. Flowcharts will set the strategic objective for a company D. Flowcharts are most important for addressing shortcomings in an insured's internal environment - ✔✔A. Looking at the process visually can help the client develop appropriate risk management techniques, such as finding an alternative supplier Which one of the following exposures would be best suited for BOP? A. An insured is concerned about professional liability claims due to their engineers completing blueprints to clients for building permits
B. An insured's workers compensation losses have been on the rise for the last three years and a policy is needed to increase loss prevention awareness C. The insured has an auto dealership and is considering adding a car wash to improve goodwill in the area D. An insured is considering upgrades to the furniture in the lobby of his business and making computers with wi-fi available to customers while they wait - ✔✔D. An insured is considering upgrades to the furniture in the lobby of his business and making computers with wi-fi available to customers while they wait The Random Bookstore is covered by an unendorsed CGL Coverage Form. A customer in the store tripped over her untied shoelace and fell, breaking her right arm. Which one of the following is a reason Random's insurer might refuse to pay any damages under Random's CGL policy? A. Premises type claims are excluded by Random's basic CGL policy B. The definition of bodily injury in the CGL policy does not include this type of injury C. This is not an occurrence as defined by Random's CGL policy D. The insured must be legally obligated before the insurer has the duty of paying - ✔✔D. The insured must be legally obligated before the insurer has the duty of paying Grace is injured at work, and her job responsibilities are reduced for 30 days, after which time she is permanently restricted by her doctor from lifting greater than 25 pounds. This will eliminate one of her job duties which is reassigned to another employee. Grace has which one of the following types of workers compensation disabilities? A. Temporary total disability B. Permanent partial disability C. Permanent total disability
C. Scan the environment D. Identify risks - ✔✔D. Identify risks A company owns land that is used as a softball diamond and recreational park for hosting employee picnics. Once a year the company also allows a non-profit organization to hold a softball game on these premises. During this year's softball game, the director of the non-profit was injured when a softball hit him in the head. He asked the company that owns the land to pay for his trip to the emergency room. The company's unendorsed Commercial General Liability policy A. Pays for the direct;s injuries sustained up to the Coverage C limit B. Does not cover the directors injuries sustained because they happened during an athletic event C. Pays up to the per occurrence liability limit for the director's injuries sustained D. Does not cover the directors injuries sustained because of the volunteer exclusion - ✔✔B. Does not cover the directors injuries sustained because they happened during an athletic event Consider the claims process, which one of the following data analysis methods begins with data analysis of claims activity logs to identify steps taken for claims and the timing of them? A. Cluster analysis B. Regression analysis C. Process mining D. Data mining - ✔✔C. Process mining Which one of the following claims would be covered under Coverage B-Personal and Advertising Injury Liability of the CGL coverage form?
A. An insured is sued for damaging a competitor's software and causing the competitor to lose business. The competitor submits a claim for his loss of business B. A landlord of a commercial building argues with a tenant, enters the tenant's store after hours and damages the tenant's merchandise. The tenant files a claim for his damaged merchandise C. When a new store opens down the street, the insured submits a false story to the newspaper stating that the store increases its prices before putting items on sale. The insured is sued for the false statements D. A store manager accuses a young man of shoplifting, apprehends him, and locks him in a strafe room until the police arrive. When its discovered that the young man is innocent, he files a claim against the store - ✔✔D. A store manager accuses a young man of shoplifting, apprehends him, and locks him in a strafe room until the police arrive. When its discovered that the young man is innocent, he files a claim against the store Injury arising out of which one of the following offenses could be covered under Coverage B of the CGL policy? A. Wrongful eviction B. Lawful prosecution C. Vandalism D. Breach of contract - ✔✔A. Wrongful eviction Ivan is a commercial insurance producer looking to expand his book of business. He is researching local businesses trying to determine which businesses might be eligible for the BOP and which would not be eligible. Which one of the following businesses would be ineligible for BOP coverage? A. Jillian's Amusement Park B. McMister Windows and Doors
