AIC 302 SIMULATED EXAM || A+ GRADED.
Conor is handling an auto claim involving the death of a minor child in a state that recognizes the
intrinsic value of children. Conor's proposed settlement amount will include correct answers A
calculated value of the child's future services to the parents.
A calculated value of the child's future services to the parents. Intrinsic value of children is the
assumption that parents invest in children knowing that they will provide for them when they are
older
Cristobal has several methods available to him as he evaluates the settlement range for his claim:
individual case method, roundtable technique, formula method, and expert system. Which
method should Cristobal use if he is dealing with a minor soft tissue claim and wants a simple
approach to achieve an early, mutually agreeable settlement? correct answers Formula method
involves a mathematical formula set by actuaries to set reserves.
Anna injured her back in a not-at-fault auto accident and has a bodily injury claim with the other
driver's insurance company. Later, she fell and her back injury was aggravated. Her claims
representative for the first accident told her that the aggravation of her back injury correct
answers Was covered because it was an unavoidable consequence of the back injury. An
intervening problem is covered if it is an unavoidable consequence of the first injury.
Some personal auto policies provide that someone could reasonably expect to be allowed to use
an insured's vehicle even if they did not ask specifically, such as a relative visiting from out of
town. This is called correct answers Implied permission.
Some policies provide for implied permission for the use of an insured's auto.
In determining coverage for emotional injury, a claims rep must understand applicable policy
language.
Which one of the following is correct? correct answers The term "harm" is potentially broader
than the term "injury"
in determining coverage for emotional injury.
Mehmet was seriously injured in an automobile collision and died after a stay in the hospital. His
family is bringing a survival action claim for medical expenses, pain and suffering, loss of
earnings, and automobile repairs. Which one of the following claims will be allowed only if the
family can demonstrate that Mehmet was conscious after the accident but before dying? correct
answers Pain and suffering can only be claimed if the decedent was conscious of the pain and
suffering before dying.
Claims reps can isolate specific coverage issues that should be investigated to determine whether
exclusions apply by using a series of yes-or-no questions in the form of a correct answers
Decision tree.
Claims reps can isolate specific coverage issues that should be investigated to determine whether
exclusions apply by using a series of yes-or-no questions in the form of a decision tree.
, Caitlin was involved in a multi-car accident on a highway. The claims representative for her
insurance company is making a case that distracted driving by Mike, one of the other drivers
involved in the accident, was a contributing cause of the accident. The records indicate that Mike
was using a hands-free device at the time of the accident. Which one of the following statements
is true regarding the use of a hands-free device while driving? correct answers The use of a
hands-free device while driving can lead to a cognitive distraction.
Sean is an auto liability claims representative. He is working on a claim involving an insured
driver who rear-ended another vehicle while driving in heavy traffic. No one was injured, but
there was $3,400 in damage to the other vehicle. Which one of the following statements is
correct regarding this accident? correct answers All four elements of negligence exist in this
accident. There was a duty owed to others to operate the vehicle safely, that duty was breached,
and was the proximate cause of the resulting $3,400 in damages. There is no clear evidence of
negligence per se provided.
Hilltop Auto Dealership (Hilltop) is insured by the Auto Dealers Coverage Form (ADCF) with a
$4 million limit for physical damage coverage on a nonreporting basis. The dealership
experienced a fire loss that resulted in $100,000 in damage to the dealer's covered autos. The
actual value of the inventory of covered autos at the time of the loss was $5 million. How much
will Hilltop's ADCF insurer pay for this covered loss? Disregard any deductibles that may apply.
correct answers $80,000
Hilltop's insurer will pay $80,000 for this covered loss. The policy limit was 80% ($4 million/$5
million) of the actual value at the time of the loss, so the insurer will only pay 80% of the loss.
$100,000 x .80 = $80,000
A technician repairing auto damage must replace a body panel as well as the running light/turn
signal mounted within the panel. The replacement of the light assembly is called a(n) correct
answers Included operation.
An included operation is any operation completed in its entirety while another, concurrent,
operation is performed.
One of the primary questions that must be answered in investigating an emotional injury claim is
whether, under the applicable policy, emotional distress is considered a(n) correct answers
Bodily injury.
Mark was involved in a rear-end collision on a highway, and is likely liable for not keeping a
clear, assured distance from the other vehicle. Joe, a passenger in the other vehicle, suffered a
serious head injury when his head hit the windshield. Mark's auto insurer is trying to defend
against the claim by arguing that the head injury would not have occurred if Joe had been
wearing his seat belt, as is required by law. Based on the laws that apply in most states, the lack-
of-seat-belt defense will result in which one of the following? correct answers Joe's failure to
wear a seat belt will not diminish or minimize Mark's liability.
When a claim involves a minor, the claims rep must resolve two independent claims: the minor's
claim for damages resulting from injury and correct answers The parent's or guardian's claim to
recover medical expenses.
Conor is handling an auto claim involving the death of a minor child in a state that recognizes the
intrinsic value of children. Conor's proposed settlement amount will include correct answers A
calculated value of the child's future services to the parents.
A calculated value of the child's future services to the parents. Intrinsic value of children is the
assumption that parents invest in children knowing that they will provide for them when they are
older
Cristobal has several methods available to him as he evaluates the settlement range for his claim:
individual case method, roundtable technique, formula method, and expert system. Which
method should Cristobal use if he is dealing with a minor soft tissue claim and wants a simple
approach to achieve an early, mutually agreeable settlement? correct answers Formula method
involves a mathematical formula set by actuaries to set reserves.
Anna injured her back in a not-at-fault auto accident and has a bodily injury claim with the other
driver's insurance company. Later, she fell and her back injury was aggravated. Her claims
representative for the first accident told her that the aggravation of her back injury correct
answers Was covered because it was an unavoidable consequence of the back injury. An
intervening problem is covered if it is an unavoidable consequence of the first injury.
Some personal auto policies provide that someone could reasonably expect to be allowed to use
an insured's vehicle even if they did not ask specifically, such as a relative visiting from out of
town. This is called correct answers Implied permission.
Some policies provide for implied permission for the use of an insured's auto.
In determining coverage for emotional injury, a claims rep must understand applicable policy
language.
Which one of the following is correct? correct answers The term "harm" is potentially broader
than the term "injury"
in determining coverage for emotional injury.
Mehmet was seriously injured in an automobile collision and died after a stay in the hospital. His
family is bringing a survival action claim for medical expenses, pain and suffering, loss of
earnings, and automobile repairs. Which one of the following claims will be allowed only if the
family can demonstrate that Mehmet was conscious after the accident but before dying? correct
answers Pain and suffering can only be claimed if the decedent was conscious of the pain and
suffering before dying.
Claims reps can isolate specific coverage issues that should be investigated to determine whether
exclusions apply by using a series of yes-or-no questions in the form of a correct answers
Decision tree.
Claims reps can isolate specific coverage issues that should be investigated to determine whether
exclusions apply by using a series of yes-or-no questions in the form of a decision tree.
, Caitlin was involved in a multi-car accident on a highway. The claims representative for her
insurance company is making a case that distracted driving by Mike, one of the other drivers
involved in the accident, was a contributing cause of the accident. The records indicate that Mike
was using a hands-free device at the time of the accident. Which one of the following statements
is true regarding the use of a hands-free device while driving? correct answers The use of a
hands-free device while driving can lead to a cognitive distraction.
Sean is an auto liability claims representative. He is working on a claim involving an insured
driver who rear-ended another vehicle while driving in heavy traffic. No one was injured, but
there was $3,400 in damage to the other vehicle. Which one of the following statements is
correct regarding this accident? correct answers All four elements of negligence exist in this
accident. There was a duty owed to others to operate the vehicle safely, that duty was breached,
and was the proximate cause of the resulting $3,400 in damages. There is no clear evidence of
negligence per se provided.
Hilltop Auto Dealership (Hilltop) is insured by the Auto Dealers Coverage Form (ADCF) with a
$4 million limit for physical damage coverage on a nonreporting basis. The dealership
experienced a fire loss that resulted in $100,000 in damage to the dealer's covered autos. The
actual value of the inventory of covered autos at the time of the loss was $5 million. How much
will Hilltop's ADCF insurer pay for this covered loss? Disregard any deductibles that may apply.
correct answers $80,000
Hilltop's insurer will pay $80,000 for this covered loss. The policy limit was 80% ($4 million/$5
million) of the actual value at the time of the loss, so the insurer will only pay 80% of the loss.
$100,000 x .80 = $80,000
A technician repairing auto damage must replace a body panel as well as the running light/turn
signal mounted within the panel. The replacement of the light assembly is called a(n) correct
answers Included operation.
An included operation is any operation completed in its entirety while another, concurrent,
operation is performed.
One of the primary questions that must be answered in investigating an emotional injury claim is
whether, under the applicable policy, emotional distress is considered a(n) correct answers
Bodily injury.
Mark was involved in a rear-end collision on a highway, and is likely liable for not keeping a
clear, assured distance from the other vehicle. Joe, a passenger in the other vehicle, suffered a
serious head injury when his head hit the windshield. Mark's auto insurer is trying to defend
against the claim by arguing that the head injury would not have occurred if Joe had been
wearing his seat belt, as is required by law. Based on the laws that apply in most states, the lack-
of-seat-belt defense will result in which one of the following? correct answers Joe's failure to
wear a seat belt will not diminish or minimize Mark's liability.
When a claim involves a minor, the claims rep must resolve two independent claims: the minor's
claim for damages resulting from injury and correct answers The parent's or guardian's claim to
recover medical expenses.
