CPCU 520 Practice Test Questions Latest Update
2025-2026 50 Questions and 100% Verified
Correct Answers Guaranteed A+
A database management system (DBMS) is a group of programs that organizes data.
Which one of the following statements is correct with respect to a DBMS? - CORRECT
ANSWER: A DBMS collects data for reuse in other systems, such as premium billing,
finance, and claims.
A document management system (DMS) stores, organizes, and retrieves image files.
Which one of the following statements is correct with respect to a DMS? - CORRECT
ANSWER: At some insurers, producers, field claims representatives, and others can
access electronic files directly.
A management control tool used to determine whether line underwriters are properly
implementing underwriting policy is known as an underwriting - CORRECT ANSWER:
Audit
All corporations are obligated to promote the well-being of society. At the minimum, this
obligation demands that the insurer should - CORRECT ANSWER: Avoid causing any
public harm.
All states attempt to ensure that continuous auto insurance coverage is available to
consumers by - CORRECT ANSWER: Restricting the rights of insurers to cancel or
nonrenew personal auto insurance policies
An agency bill process in which the producer is usually not required to pay the insurer
until the premium is collected from the policyholder is known as - CORRECT ANSWER:
The item basis.
, Every state insurance department is headed by a state insurance commissioner, a
director, or by a - CORRECT ANSWER: Superintendent.
Filip is quoting to get Osakri's business and is not concerned with the adequacy of
Mellfor's coverage with actual cash value on contents. Filip's behavior involving Osakri
is known as - CORRECT ANSWER: Twisting.
How often does the National Association of Insurance Commissioners (NAIC) meet to
discuss important problems and issues in insurance regulation? - CORRECT ANSWER:
Three times a year
Information technology (IT) can help insurers increase operational efficiency. Which one
of the following would enable field claim representatives at a storm site to access policy
information, transmit claims information, and settle losses or make partial payments
immediately so that displaced families could return to their homes as soon as possible?
- CORRECT ANSWER: Low cost mobile technology
Insurers can use information technology (IT) to gain competitive advantage. Which one
of the following statements is correct with respect to gaining competitive advantage? -
CORRECT ANSWER: IT intelligence gives insurers better insight for underwriting,
product development, and pricing
Martin Insurance Company targets international manufacturers of specialty products. Its
insureds place a high value on producer expertise, responsiveness, and confidentiality.
Martin wants to expand into similar markets. Which one of the following insurance
marketing distribution systems is most appropriate for Martin Insurance Company? -
CORRECT ANSWER: Direct writer
Omicron Manufacturing has approached Delta Insurance Brokerage to develop and
implement a voluntary insurance program for life, health, and disability insurance for
Omicron's employees. Delta puts together a program in which employees receive the
coverage at discounted rates, and premiums are deducted from the employees'
paychecks. Omicron and Delta are using which one of the following types of group
marketing to offer this program? - CORRECT ANSWER: Franchise marketing
2025-2026 50 Questions and 100% Verified
Correct Answers Guaranteed A+
A database management system (DBMS) is a group of programs that organizes data.
Which one of the following statements is correct with respect to a DBMS? - CORRECT
ANSWER: A DBMS collects data for reuse in other systems, such as premium billing,
finance, and claims.
A document management system (DMS) stores, organizes, and retrieves image files.
Which one of the following statements is correct with respect to a DMS? - CORRECT
ANSWER: At some insurers, producers, field claims representatives, and others can
access electronic files directly.
A management control tool used to determine whether line underwriters are properly
implementing underwriting policy is known as an underwriting - CORRECT ANSWER:
Audit
All corporations are obligated to promote the well-being of society. At the minimum, this
obligation demands that the insurer should - CORRECT ANSWER: Avoid causing any
public harm.
All states attempt to ensure that continuous auto insurance coverage is available to
consumers by - CORRECT ANSWER: Restricting the rights of insurers to cancel or
nonrenew personal auto insurance policies
An agency bill process in which the producer is usually not required to pay the insurer
until the premium is collected from the policyholder is known as - CORRECT ANSWER:
The item basis.
, Every state insurance department is headed by a state insurance commissioner, a
director, or by a - CORRECT ANSWER: Superintendent.
Filip is quoting to get Osakri's business and is not concerned with the adequacy of
Mellfor's coverage with actual cash value on contents. Filip's behavior involving Osakri
is known as - CORRECT ANSWER: Twisting.
How often does the National Association of Insurance Commissioners (NAIC) meet to
discuss important problems and issues in insurance regulation? - CORRECT ANSWER:
Three times a year
Information technology (IT) can help insurers increase operational efficiency. Which one
of the following would enable field claim representatives at a storm site to access policy
information, transmit claims information, and settle losses or make partial payments
immediately so that displaced families could return to their homes as soon as possible?
- CORRECT ANSWER: Low cost mobile technology
Insurers can use information technology (IT) to gain competitive advantage. Which one
of the following statements is correct with respect to gaining competitive advantage? -
CORRECT ANSWER: IT intelligence gives insurers better insight for underwriting,
product development, and pricing
Martin Insurance Company targets international manufacturers of specialty products. Its
insureds place a high value on producer expertise, responsiveness, and confidentiality.
Martin wants to expand into similar markets. Which one of the following insurance
marketing distribution systems is most appropriate for Martin Insurance Company? -
CORRECT ANSWER: Direct writer
Omicron Manufacturing has approached Delta Insurance Brokerage to develop and
implement a voluntary insurance program for life, health, and disability insurance for
Omicron's employees. Delta puts together a program in which employees receive the
coverage at discounted rates, and premiums are deducted from the employees'
paychecks. Omicron and Delta are using which one of the following types of group
marketing to offer this program? - CORRECT ANSWER: Franchise marketing
