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1. Which is NOT one of the three types of knowledge an underwriter requires to be successful in their role?
A) Claims knowledge
B) Industry knowledge
C) Prescription knowledge
D) Insurance product knowledge
2. Mark was involved in an at-fault accident one year ago. As there was minimal vehicle damage and no apparent injuries, Mark settled with the third party and did NOT report the accident to his insurer. Today, Mark has been served a statement of claim alleging long-term injuries. Which action will Mark's insurer MOST LIKELY take, and why?
A) Pay the claim because accident benefit coverages have no expiration date
B) Deny the claim because a limitation period is in effect
C) Deny the claim because Mark had forfeited the right of recovery
D) Pay the claim because Mark's current policy must respond to a liability claim
3. How do insurers try to balance premiums against the losses they might have?
A) By writing as much business in one location as possible
B) By having a good spread of risk
C) Through specializing in one or two kinds of risk
D) Through insuring a small number of superior risks
4. When one reinsurer cedes part of its business to another reinsurer, what is the second reinsurer called?
A) Retrocessionaire
B) Cessionaire
C) Primary Insurer
D) Alternate Insurer
5. Which statement reflects the concept that the premium for each risk should be commensurate with that risk?
A) Risks more likely to have losses should pay higher premiums
B) Risks can happen to anyone, so each individual should purchase insurance
C) Proper settlement of losses should be paid out of the pool of funds
D) One or more persons should provide protection to another person against loss
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: C | Question # 3 Answer: B | Question # 4 Answer: A | Question # 5 Answer: A |
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