AINS 101 EXAM LATEST 2026|2027 UPDATED QUESTIONS WITH
DETAILED VERIFIED ANSWERS (100%) | ALREADY GRADED A+
Spencer Insurance Associates is an independent agency selling primarily homeowners policies. This
agency - Correct Answer -Is free to work with as many different insurers as it wants.
Which one of the following statements is correct regarding the interaction between risk control and other
insurer functions? - Correct Answer -A risk control evaluation can make the difference between the
applicant's being rejected or accepted by the underwriter.
Insuring individuals with a high probability of loss at a cost lower than the insurer would normally charge
for that risk because it wasn't aware of the actual risk involved is known as - Correct Answer -Adverse
selection
Clare is a commercial lines underwriter. She always tries to follow underwriting guidelines, effectively
evaluate loss exposures, and charge adequate premiums. By doing these things, Clare's goal is to ensure
- Correct Answer -Adequate policyholders' surplus
Tony now works at the corporate level for Newtown Insurance. He is considered a staff underwriter.
Which one of the following is primarily a responsibility of staff underwriters? - Correct Answer -Revise
underwriting guidelines
1|Page
,Brian works in the Underwriting department for DGH Insurance. In addition to carefully selecting
insureds, he works with producers and premium auditors to ensure accurate classification and pricing.
Brian is a - Correct Answer -Field underwriter
Which one of the following is a temporary agreement providing insurance coverage until the formal policy
is issued? - Correct Answer -Binder
As an experienced underwriter, Rick has learned to make every effort to avoid a mistake that can produce
insufficient premium to cover losses, or pricing that isn't competitive. Which one of the following
underwriting mistakes can often cause these issues? - Correct Answer -Misclassifying exposures
Bob is shopping for auto insurance. Insurance Company A's rating system determines that Bob should be
charged $800 per auto. If Bob is looking to insure four autos, what premium will he be charged by
Insurance Company A? - Correct Answer -$3,200
The size of an employer's loss exposure for workers compensation insurance is based on - Correct
Answer -The amount of its payroll
Stephanie works for Waynesgood Insurance. She appreciates the help she receives from Clem in the
company's claims department who provides her with recent statistics and comments on Waynesgood's
2|Page
, customer satisfaction levels. Stephanie works in which one of the following departments? - Correct
Answer -Marketing
Willis, a claims representative, is collaborating with his colleague Suzanna from his insurance company's
risk control department. How will Suzanna help Willis? - Correct Answer -Provide laboratory analysis
when Willis is investigating a claim
What term refers to the ability of an insurer to meet its obligations as they become due? - Correct
Answer -Solvency
All of the following are categories of liabilities found on an insurer's balance sheet, EXCEPT: - Correct
Answer -Policyholders' surplus
The major categories of liabilities found on an insurer's financial statements are - Correct Answer -loss
and loss expense reserves, unearned premium reserves, and other liabilities.
Most of the income an insurer receives is either from underwriting or - Correct Answer -Investments
An insurer's financial statement shows a loss reserve and an unearned premium reserve. These reserves
are part of the insurer's - Correct Answer -Total liabilities
3|Page
DETAILED VERIFIED ANSWERS (100%) | ALREADY GRADED A+
Spencer Insurance Associates is an independent agency selling primarily homeowners policies. This
agency - Correct Answer -Is free to work with as many different insurers as it wants.
Which one of the following statements is correct regarding the interaction between risk control and other
insurer functions? - Correct Answer -A risk control evaluation can make the difference between the
applicant's being rejected or accepted by the underwriter.
Insuring individuals with a high probability of loss at a cost lower than the insurer would normally charge
for that risk because it wasn't aware of the actual risk involved is known as - Correct Answer -Adverse
selection
Clare is a commercial lines underwriter. She always tries to follow underwriting guidelines, effectively
evaluate loss exposures, and charge adequate premiums. By doing these things, Clare's goal is to ensure
- Correct Answer -Adequate policyholders' surplus
Tony now works at the corporate level for Newtown Insurance. He is considered a staff underwriter.
Which one of the following is primarily a responsibility of staff underwriters? - Correct Answer -Revise
underwriting guidelines
1|Page
,Brian works in the Underwriting department for DGH Insurance. In addition to carefully selecting
insureds, he works with producers and premium auditors to ensure accurate classification and pricing.
Brian is a - Correct Answer -Field underwriter
Which one of the following is a temporary agreement providing insurance coverage until the formal policy
is issued? - Correct Answer -Binder
As an experienced underwriter, Rick has learned to make every effort to avoid a mistake that can produce
insufficient premium to cover losses, or pricing that isn't competitive. Which one of the following
underwriting mistakes can often cause these issues? - Correct Answer -Misclassifying exposures
Bob is shopping for auto insurance. Insurance Company A's rating system determines that Bob should be
charged $800 per auto. If Bob is looking to insure four autos, what premium will he be charged by
Insurance Company A? - Correct Answer -$3,200
The size of an employer's loss exposure for workers compensation insurance is based on - Correct
Answer -The amount of its payroll
Stephanie works for Waynesgood Insurance. She appreciates the help she receives from Clem in the
company's claims department who provides her with recent statistics and comments on Waynesgood's
2|Page
, customer satisfaction levels. Stephanie works in which one of the following departments? - Correct
Answer -Marketing
Willis, a claims representative, is collaborating with his colleague Suzanna from his insurance company's
risk control department. How will Suzanna help Willis? - Correct Answer -Provide laboratory analysis
when Willis is investigating a claim
What term refers to the ability of an insurer to meet its obligations as they become due? - Correct
Answer -Solvency
All of the following are categories of liabilities found on an insurer's balance sheet, EXCEPT: - Correct
Answer -Policyholders' surplus
The major categories of liabilities found on an insurer's financial statements are - Correct Answer -loss
and loss expense reserves, unearned premium reserves, and other liabilities.
Most of the income an insurer receives is either from underwriting or - Correct Answer -Investments
An insurer's financial statement shows a loss reserve and an unearned premium reserve. These reserves
are part of the insurer's - Correct Answer -Total liabilities
3|Page
