AINS 101 COMPREHENSIVE EXAMINATION
2026 FULL QUESTIONS AND CORRECT
ANSWERS
◉ New homeowner and small business owner Sallie learns that an
insurance policy may contain other documents than its insurance
forms. Accordingly, which one of the following will Sallie find is true
regarding her new insurance purchases?
A. As Sallie's policy coverages are relatively common, she will simply
require a manuscript policy.
B. Sallie's application may contain endorsements which modify the
basic policy form.
C. Sallie learned all policies, personal and commercial, contain
relevant statutory terms for clarity.
D. Sallie's application for insurance was returned to her as it was no
longer useful after receiving her policy.
Answer: Sallie's application may contain endorsements which
modify the basic policy form.
◉ Claims supervisor Charlotte is reviewing the incoming claims for
the day to decide which ones to assign to various claims reps. Of
those claims, which one of the following descriptions will Charlotte
find is an example of a fortuitous loss?
,A. The value of an insured's home decreases due to a lack of
maintenance.
B. Insureds intentionally set a fire and burn their house down.
C. An unknown vandal spray-paints graffiti on the insured's garage.
D. An insured demolishes a deck that has been allowed to rot.
Answer: An unknown vandal spray-paints graffiti on the insured's
garage.
◉ An insurer will make a loss payment if an insured loss occurs and
if the insured performs certain duties. This illustrates that an
insurance policy is a
A. Conditional contract.
B. Contract of indemnity.
C. Personal contract.
D. Contract of adhesion.
Answer: Conditional contract.
◉ Solvency
Answer: The ability of an insurer to meet its financial obligations as
they become due, even those resulting from insured lossses that may
be claimed several years in the future.
,◉ Income statement
Answer: The financial statement that reports an organization's profit
or loss for a specific period by comparing the revenues generated
with the expenses incurred to produce those revenues.
◉ Earned premiums
Answer: The portion of the written premiums that apply to the part
of the policy period that has already occurred
◉ Underwriting income
Answer: Income an insurer earns from premiums paid by
policyholders minus incurred losses and underwriting expenses
◉ Balance sheet
Answer: The financial statement that reports the assets, liabilities,
and owners' equity of an organization as of a specific date.
◉ Policyholders surplus
Answer: An insurer's assets minus its liabilities, which represents its
net worth.
◉ Loss adjustment expenses
, Answer: The expense that an insurer incurs to investigate, defend,
and settle claims according to the terms specified in the insurance
policy
◉ Assets
Answer: Types of property, both tangible and intangible, owned by
an entity
◉ Liabilities
Answer: Financial obligations, or debts, owed by a company to
another entity, usually the policyholder in the case of an insurer.
◉ Investment income
Answer: Interest, dividends, and net capital gains received by an
insurer from the insurer's financial assets, minus its investment
expenses.
◉ Loss reserve
Answer: An estimate of the amount of money the insurer expects to
pay in the future for losses that have occurred.
◉ Unerned premium reserve
Answer: An insurer liability representing the amount of premiums
received from policyholders that are not yet earned.
2026 FULL QUESTIONS AND CORRECT
ANSWERS
◉ New homeowner and small business owner Sallie learns that an
insurance policy may contain other documents than its insurance
forms. Accordingly, which one of the following will Sallie find is true
regarding her new insurance purchases?
A. As Sallie's policy coverages are relatively common, she will simply
require a manuscript policy.
B. Sallie's application may contain endorsements which modify the
basic policy form.
C. Sallie learned all policies, personal and commercial, contain
relevant statutory terms for clarity.
D. Sallie's application for insurance was returned to her as it was no
longer useful after receiving her policy.
Answer: Sallie's application may contain endorsements which
modify the basic policy form.
◉ Claims supervisor Charlotte is reviewing the incoming claims for
the day to decide which ones to assign to various claims reps. Of
those claims, which one of the following descriptions will Charlotte
find is an example of a fortuitous loss?
,A. The value of an insured's home decreases due to a lack of
maintenance.
B. Insureds intentionally set a fire and burn their house down.
C. An unknown vandal spray-paints graffiti on the insured's garage.
D. An insured demolishes a deck that has been allowed to rot.
Answer: An unknown vandal spray-paints graffiti on the insured's
garage.
◉ An insurer will make a loss payment if an insured loss occurs and
if the insured performs certain duties. This illustrates that an
insurance policy is a
A. Conditional contract.
B. Contract of indemnity.
C. Personal contract.
D. Contract of adhesion.
Answer: Conditional contract.
◉ Solvency
Answer: The ability of an insurer to meet its financial obligations as
they become due, even those resulting from insured lossses that may
be claimed several years in the future.
,◉ Income statement
Answer: The financial statement that reports an organization's profit
or loss for a specific period by comparing the revenues generated
with the expenses incurred to produce those revenues.
◉ Earned premiums
Answer: The portion of the written premiums that apply to the part
of the policy period that has already occurred
◉ Underwriting income
Answer: Income an insurer earns from premiums paid by
policyholders minus incurred losses and underwriting expenses
◉ Balance sheet
Answer: The financial statement that reports the assets, liabilities,
and owners' equity of an organization as of a specific date.
◉ Policyholders surplus
Answer: An insurer's assets minus its liabilities, which represents its
net worth.
◉ Loss adjustment expenses
, Answer: The expense that an insurer incurs to investigate, defend,
and settle claims according to the terms specified in the insurance
policy
◉ Assets
Answer: Types of property, both tangible and intangible, owned by
an entity
◉ Liabilities
Answer: Financial obligations, or debts, owed by a company to
another entity, usually the policyholder in the case of an insurer.
◉ Investment income
Answer: Interest, dividends, and net capital gains received by an
insurer from the insurer's financial assets, minus its investment
expenses.
◉ Loss reserve
Answer: An estimate of the amount of money the insurer expects to
pay in the future for losses that have occurred.
◉ Unerned premium reserve
Answer: An insurer liability representing the amount of premiums
received from policyholders that are not yet earned.
