Download AINS 102 - Associate in Insurance (AINS) designation EXAM 2026-2027 LATEST UPDATED VERSION and more Exams Insurance law in PDF only on Docsity!
AINS 102 - Associate in Insurance (AINS)
designation EXAM 2026-2027 LATEST UPDATED
VERSION QUESTIONS AND ANSWERS
A company that uses a mobile application or website to connect riders with drivers and arrange transportation in a personal auto for a fee is called a Select one:
A. Limited transportation network. B. Transportation network company. C. Livery conveyance. D. Personal auto company. - answer>>>B. Transportation network company.
Which one of the following is correct regarding the Transportation Network Driver Coverage (No Passenger) endorsement and the Limited Transportation Network Driver Coverage (No Passenger) Endorsement to the personal auto policy?
Select one:
A. They both provide coverage until a passenger enters the vehicle. B. They both exclude coverage when a passenger is occupying the vehicle. C. They both provide the same coverage, but one requires more premium. D. They both end coverage when an insured accepts a passenger's request. - answer>>>B. They both exclude coverage when a passenger is occupying the vehicle.
Erin makes custom draperies in the basement of her home. Initially, she made these draperies for herself and family members, but she began to sell these draperies to a broader audience. Which one of the following exposures would likely be covered under an unendorsed homeowners policy should Erin's home be destroyed by a covered peril?
Select one:
A. The loss of customer data Erin stored on her computer B. The loss of income from drapery sales while the home is rebuilt
C. The cost to replace her sewing equipment D. The cost of materials purchased to aid in increasing sales - answer>>>C. The cost to replace her sewing equipment
Which one of the following changes the definition of "business" in the homeowners policy to include home-sharing?
Select one:
A. Damage to Property of Others—Increased Limits endorsement B. Home-sharing Host Activities Damage to Property of Others provision C. Home-sharing Host Activities Amendatory Endorsement D. Broadened Home-sharing Host Activities Coverage Endorsement - answer>>>C. Homesharing Host Activities Amendatory Endorsement
Beachfront and windstorm plans are state-sponsored insurance plans whose primary purpose is to Select one:
A. Provide flexible coverage to fill gaps in the National Flood Insurance Program's flood coverages. B. Provide a state-based alternative to the federally operated flood insurance programs. C. Restrict construction and limit land use in coastal areas exposed to heavy windstorm losses. D. Provide property insurance in coastal areas exposed to heavy windstorm losses. - answer>>>D. Provide property insurance in coastal areas exposed to heavy windstorm losses.
Which one of the following is the most common cause of ignition in wildfires?
Select one:
A. Campfires B. Arson C. Lightning strikes
D. Completing an annual policy review - answer>>>A. Offering to quote other lines of coverage
For an agent, all of the following are advantages of cross-selling, EXCEPT:
Select one:
A. Increased profitability B. Ease of additional growth C. Improved customer retention D. Enhanced ability to compete strictly on price - answer>>>D. Enhanced ability to compete strictly on price
Adjuster Ed has just been notified of a suspicious theft loss to an insured's home in a secluded area. Ed has contacted the insured to acknowledge that he has received the loss report. Ed's next course of action should be to Select one:
A. Verify the extent of the loss to the insured property. B. Verify coverage. C. Remove any property that remains in harm's way to protect it from further damage. D. Advise the insured that the claim is suspicious. - answer>>>B. Verify coverage.
After an insurer acknowledges a claim from an insured and assigns the claim to a representative, the representative needs to identify and check the policy. Identifying the policy requires the claim representative to Select one:
A. Check for errors in the declarations page. B. Notify the agent that a loss has occurred. C. Make sure the policy is filed correctly. D. Determine whether coverage applies to the loss. - answer>>>D. Determine whether coverage applies to the loss.
The Davis family suffered extensive fire damage to its home and was temporarily unable to inhabit it. The family was forced to rent a hotel room while its home was under repair. The cost incurred to rent the hotel room is referred to as which one of the following outcomes of loss?
Select one:
A. Lost income B. Increased expenses C. Reduction in value of property D. Special damages - answer>>>B. Increased expenses
All of the following items are examples of personal property, EXCEPT:
Select one:
A. A diamond wedding ring B. A set of cookware C. A fishing boat D. A detached garage - answer>>>D. A detached garage
SF Poultry learned that a number of individuals had become ill and hospitalized after eating chicken from one of its processing plants. The company did not advise the public or its distributors of the problem, and made no effort to recall the spoiled product. Over 50 individuals ended-up becoming ill from the spoiled chicken. SF Poultry was found liable in court. In addition to having to pay the medical and hospital bills for the injured individuals, damages were levied against SF Poultry to punish the company for its reckless and deceitful actions. These damages that were levied against SF Poultry are known as Select one:
A. Punitive damages. B. General damages. C. Special damages. D. Necessary damages. - answer>>>A. Punitive damages.
C. The insurance limits they have purchased are equal to or greater than the state minimum limits before they can collect damages. D. They have met the financial responsibility laws of the state before they can collect damages. - answer>>>A. Another party was at fault before they can collect damages.
Rick and Jamie have chosen their first home and now are asking their insurance agent Franklin to help advise them as to appropriate and affordable insurance coverage. Which one of the following will most accurately reflect the best coverage choice for Rick and Jamie?
Select one:
A. As Rick and Jamie are buying and remodeling an older home, Franklin suggests an HO-8 modified coverage form to provide appropriate coverage for a building with a comparatively high replacement cost. B. As Rick and Jamie are buying a residential condo, Franklin suggests the HO- special form as they will be needing limited dwelling coverage. C. As Rick and Jamie will be renting an apartment for a few years, Franklin suggests an HO-2 broad form as they will not need any dwelling coverage. D. As Rick and Jamie will be buying a mansion, Franklin suggests an HO- comprehensive form as it provides the highest dollar amounts of any coverage avail - answer>>>A. As Rick and Jamie are buying and remodeling an older home, Franklin suggests an HO-8 modified coverage form to provide appropriate coverage for a building with a comparatively high replacement cost.
Which one of the following is true regarding the use of technology in home risk management?
Select one:
A. Technology is more prevalent, abundant, and useful in homes than in automotive environments. B. Smart devices in the home have reaffirmed the need for existing claims data to assess risk.
C. Data gathered from sensors is used by insurers for personalized pricing and claims handling. D. Sensors are generally regarded as useful in loss prevention, but not in loss reduction. - answer>>>C. Data gathered from sensors is used by insurers for personalized pricing and claims handling.
Vivian is an auto claims adjuster. She wanted to make sure that the vehicle identification number (VIN) of the damaged vehicle matched the VIN shown on the Personal Auto Policy (PAP), the VIN can be found Select one:
A. On the Declarations page. B. On the state endorsements. C. In the Insuring Agreement. D. In the definitions section. - answer>>>A. On the Declarations page.
In the auto insurance policy definitions, an eligible private passenger auto, pickup, or van of which the named insured becomes the owner during the policy period is a Select one:
A. Temporary substitute vehicle. B. Newly acquired auto. C. Replacement auto. D. Trailer. - answer>>>B. Newly acquired auto.
Stu is a high school student. Stu and three of his friends decided on a car-pool arrangement to get to school instead of taking the bus. Stu would drive his mom's car, and each friend would chip in towards gas. Stu did not inform his parents of his plans.
While driving to school on the first day of the car-pool arrangement, Stu and his passengers saw a science teacher who had recently given Stu a low grade. In an attempt at revenge, Stu drove his mom's car into the teacher's car, causing moderate damage to both vehicles. The teacher pressed charges and also made a property damage claim against Stu, who turned the claim over to the family's Personal Auto Policy (PAP) insurer.
driver was ever identified. Jill sustained injuries in the accident and made an uninsured motorists (UM) coverage claim under her PAP. Jill will Select one:
A. Not be able to recover under her UM coverage because the driver of the other car was not at fault for the accident. B. Be able to recover under her UM coverage because the other car was a hit-and- run vehicle. C. Not be able to recover under her UM coverage because the other car was a hit- and-run vehicle. D. Not be able to provide the other driver with UM coverage under her PAP because he or she has never been identified. - answer>>>A. Not be able to recover under her UM coverage because the driver of the other car was not at fault for the accident.
Li has a Personal Auto Policy (PAP) for his car with a $100,000 limit for uninsured motorists (UM) coverage. He was injured in an accident with a legally intoxicated uninsured motorist. Li submitted a UM claim to his insurer. The case went to trial and Li was awarded $50,000 for medical bills, $10,000 for rehabilitation expenses, $5,000 for lost wages, and $10,000 for punitive damages. How much can Li collect under the UM coverage of his PAP?
Select one:
A. $50, B. $55, C. $65, D. $75,000 - answer>>>C. $65,
Under the Personal Auto Policy (PAP), a branch falling from a tree and denting the hood of a covered auto is an example of Select one:
A. An uninsured motorists loss. B. A liability loss. C. An other than collision loss. D. A collision loss. - answer>>>C. An other than collision loss.
Which one of the following causes of loss is covered under the other than collision (OTC) section of the Personal Auto Policy (PAP)?
Select one:
A. Hitting a tree B. Falling objects C. Overturn from the driver losing control D. Hitting another car - answer>>>B. Falling objects
Personal auto policy endorsements can be categorized into two main categories. One of these categories is Select one:
A. Endorsements that provide higher coverage limits for navigation systems permanently installed in the vehicles and various media owned by the named insured. B. Endorsements that provide coverage additions/modifications for customers who own vehicles other than cars, vans, or pickup trucks. C. Endorsements that can be added to either a homeowners or personal auto policy the address specific loss exposures not covered by an unendorsed PAP. D. Endorsements that provide coverage for owners of high-value antique cars that result in higher premiums reflecting the valuable worth of such vehicles. - answer>>>B. Endorsements that provide coverage additions/modifications for customers who own vehicles other than cars, vans, or pickup trucks.
Steve and Amy were about to purchase their first home. During the process, they were advised that they needed to purchase a HO-3 insurance policy. The HO-3 policy would provide Steve and Amy with coverage for all of the following, EXCEPT:
Select one:
A. Personal Liability B. Their cars C. The contents of the house
Select one:
A. Coverage A—Dwelling B. Coverage B—Other Structures C. Coverage C—Personal Property D. Coverage D—Loss of Use - answer>>>B. Coverage B—Other Structures
Sammy and Sally Oshua insure their home with an HO-3 policy. They own a cocker spaniel puppy. While a neighboring couple and their five-year-old daughter were visiting, the puppy bit the girl as she was playing with it. The child suffered a serious wound and the neighbors sued the Oshuas. Which one of the following statements is true?
Select one:
A. Defense costs are not covered for the Oshuas if the lawsuit is found to be groundless. B. Because the child is a minor, the insurer will pay the damages regardless of legal liability. C. Because the dog was on the Oshuas' property, they are not covered for injury to the child. D. In addition to paying up to the limit of liability, the insurer will pay defense costs associated with the lawsuit. - answer>>>D. In addition to paying up to the limit of liability, the insurer will pay defense costs associated with the lawsuit.
Tomas has an HO-3 policy covering his home. A neighbor jumped Tomas's fence to use his yard as a shortcut to a store, tripped over a small shovel left on the lawn, and was injured. The neighbor sued Tomas. Tomas's insurer defended and won the lawsuit on the theory that the neighbor was a trespasser to whom no duty was owed by Tomas. The insurer's defense included $20,000 in legal fees. Who is responsible for these fees?
Select one:
A. Tomas's HO-3 insurer is responsible for the legal fees. B. The insurer is responsible for the legal fees only if Tomas is not able to pay them. C. Tomas is, because liability coverage is not triggered absent a finding of liability.
D. Tomas and the insurer share responsibility for the legal fees. - answer>>>A. Tomas's HO-3 insurer is responsible for the legal fees.
The medical payments coverage in a homeowners policy covers certain medical expenses incurred by Select one:
A. Nonresidents of the insured's household. B. Insureds. C. A person uninvited to the insured's home. D. Regular household residents other than residence employees. - answer>>>A. Nonresidents of the insured's household.
Coverage F—Medical Payments to Others in the homeowners policy applies to bodily injury to a residence employee in all of the following situations, EXCEPT:
Select one:
A. The residence employee is away from the insured location and is not working B. The residence employee is away from the insured location but is working C. The residence employee is on the insured location but is not working D. The residence employee is on the insured location and is working - answer>>>A. The residence employee is away from the insured location and is not working
Jack and Bobbie own several properties. Which one of the following would be their only property that could be insured by an HO-3 policy?
Select one:
A. They live in one unit of a four-family dwelling and rent out the others. B. They have purchased a beach house that is currently under construction. C. They own a mobile home that is permanently situated in a thriving community. D. They own another four-family dwelling and rent out all four units. - answer>>>A. They live in one unit of a four-family dwelling and rent out the others.
Which one of the following types of personal inland marine forms should Jeff recommend to Roger and Sarah to protect the items they placed in the storage facility?
Select one:
A. A Personal Articles Standard Loss Settlement Form B. A Personal Property Form C. A Personal Effects Form D. A Tenant Homeowners Form - answer>>>B. A Personal Property Form
Roger and Sarah sold their house and plan to travel around the world for one year. They placed their furniture and appliances in storage and will take luggage and cameras on their trip. Sarah will travel with her diamond engagement ring. Jeff, their insurance agent, canceled their homeowners policy soon after the house was sold.
Which one of the following types of personal inland marine forms should Jeff recommend to Roger and Sarah to protect their luggage on the trip?
Select one:
A. Personal Articles Standard Loss Settlement Form B. Personal Property Form C. Personal Effects Form D. Tenant Homeowners Form - answer>>>C. Personal Effects Form
Which one of the following can be covered for physical damage and liability coverage by a Personal Auto Policy (PAP)?
Select one:
A. Boat under 26 feet B. Boat being transported by personal auto C. Boat trailer D. Jet ski - answer>>>C. Boat trailer
Individuals with larger boats are usually insured by a yacht policy which contains several warranties. Which one of the following is one of these warranties?
Select one:
A. The boat has a paid captain and crew. B. The boat can only be used for specified business purposes. C. There will be no medical payments coverage. D. The boat is in seaworthy condition. - answer>>>D. The boat is in seaworthy condition.
Manuel has been sued and is awaiting a court judgment. In terms of legal defense costs, which one of the following would most likely be covered under a personal umbrella policy?
Select one:
A. Intentional injury B. Interest on unpaid judgments C. Workers compensation D. Damage to property an insured owns - answer>>>B. Interest on unpaid judgments
Personal umbrella policies usually cover the insured's liability for personal injury. Under the Personal Umbrella Liability Policy, which one of the following is included under the definition of personal injury?
Select one:
A. False arrest B. Assault and battery intentionally committed C. Abandonment D. Professional liability - answer>>>A. False arrest
Christina and Carlos Thomas have decided to place their auto insurance needs with the Windspring Group, a type of insurance arrangement called peer-to-peer insurance. Which one of the following will the Thomas family experience with this situation?
B. Provides coverage when the insured is logged into a transportation network platform until the driver accepts a passenger's request. C. Provides coverage without passengers while the driver is logged into a transportation network platform. D. Specifies that coverage does not apply to Part C—Uninsured Motorists Coverage. - answer>>>C. Provides coverage without passengers while the driver is logged into a transportation network platform.
Mary is a transportation network driver. The transportation network company (TNC) she drives for provides a commercial policy that begins when a passenger enters Mary's personal auto. Based on this, which one of the following should Mary add to her personal auto policy (PAP)?
Select one:
A. Public or Livery Conveyance Exclusion Endorsement B. Transportation Network Driver Coverage (No Passenger) endorsement C. Limited Transportation Network Driver Coverage (No Passenger) Endorsement D. Transportation Network Platform Definition Endorsement - answer>>>B. Transportation Network Driver Coverage (No Passenger) endorsement
Winona now has a picture framing business she conducts from her home, but has never amended her unendorsed homeowners policy to reflect the business exposures. If her home were damaged or destroyed by a covered cause of loss, which one of the following would be covered?
Select one:
A. Framed pictures awaiting customer pickup B. Framed pictures of Winona's grandchildren C. Boxes of frames for future jobs D. Disks with information on current customers - answer>>>B. Framed pictures of Winona's grandchildren
Erin makes custom draperies in the basement of her home. Initially, she made these draperies for herself and family members, but she began to sell these draperies to a broader audience. Which one of the following exposures would likely be covered under an unendorsed homeowners policy should Erin's home be destroyed by a covered peril?
Select one:
A. The cost to replace her sewing equipment B. The cost of materials purchased to aid in increasing sales C. The loss of income from drapery sales while the home is rebuilt D. The loss of customer data Erin stored on her computer - answer>>>A. The cost to replace her sewing equipment
Most beachfront and windstorm plans provide coverage for which one of the following exposures in addition to windstorm?
Select one:
A. Erosion B. Fire C. Flood D. Hail - answer>>>D. Hail
Which one of the following is a primary basis for a property to be eligible for coverage under beachfront and windstorm plans?
Select one:
A. The property must be certified by FEMA, eligible for flood insurance and located in a designated coastal area. B. The property must be ineligible for coverage in the voluntary market and must be located within at least 10 miles of a flood plain. C. The property must be ineligible for coverage in the voluntary market and must be located in designated coastal areas.
