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AINS 101 Exam Prep – Questions and Correct Rationalized Answers | 2025/2026 Edition, Exams of Nursing

Hillsborough Community CollegeNursing

AINS 101 Exam Prep – Questions and Correct Rationalized Answers | 2025/2026 Edition This document offers a complete set of AINS 101 (Associate in General Insurance) exam prep questions with correct and rationalized answers, specifically updated for the 2025/2026 exam cycle. It covers all key content areas, including insurance principles, risk management, policy structure, underwriting fundamentals, and claims processes. Each answer is explained with clear reasoning to enhance understanding and retention, making it an ideal study tool for certification success.

Typology: Exams

2024/2025

Available from 06/11/2025

Nurseexcel
Nurseexcel 🇺🇸

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AINS 101 Exam Prep Questions and Correct Rationalized Answers
1. Assassinglesmothersonsasverystightsbudget,sCiarasisstemptedstosskimpsonshersinsurance.sH
owever,shersfriendsMehmetstellsshersnotstosskimpsonsinsurance,sbecausesitswillshelpsmana
gesherscashsflows.sWhichsonesofsthesfollowingsexam-splessbestsillustratessMehmet'sspoint?s
A.
Ciarasneedssherscarstosgetstoshersjob,sandsshesneedsshersjobstosmakescarspaymentssa
ndspaysforsherscarsinsurance.
B.
Whensherscar'sswindshieldsbreaks,sCiarashasstospaysonlys$100sofsthes$600scostsofsrepl
acingsit.
C.
Whensherscar'sstransmissionsgoessoutsasmonthsafterstheswarrantysexpires,sCiarasissface
dswithsas$1,100srepairsbill.
D.
Ciarasfindssitsdifficultstoscomesupswithsas$787sautosinsurancespremiumseveryssixsmonths.:
sWhensherscar'sswindshieldsbreaks,sCiarashasstospaysonlys$100sofsthe
$600scostsofsreplacingsit.
2. Whichsonesofsthesfollowingsstatementssisscorrectsregardingsthesbenefitssprovidedsby
sinsurance?
A.
Insurancesreducessthesfinancialsconsequencessofslosssexposuressbutsnotsthesrelateds
uncertainty.
B.
Thesprimarysrolesofsinsurancesisstosmeetsmandatorysinsurancesrequire-sments.
C.
Thesreductionsinslossesspaidsbysinsurerssduestosriskscontrolsmeasuressbenefitssind
ividualsinsuredssbutsnotssocietysassaswhole.
D.
Insuranceshelpssreducesthesfinancialsburdenstossocietysbyscompensatingsaccidentsvict
ims.:sInsuranceshelpssreducesthesfinancialsburdenstossocietysbyscom-
spensatingsaccidentsvictims.
3. SheltonsIndustriessexperiencedsasfiresinsitssmanufacturingsplant.sSeveralsemployeesssu
fferedsburnssandssmokesinhalationsinjuriessasstheystriedstosescapesthesbuilding.sWhichsones
ofsSheltonsIndustries'scommercialsproperty-ca-
ssualtyspoliciesswouldspaysforsthesemployees'sinjuriessandsillnesses?:sWorkersscompensati
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1 s/s 113

AINS 101 Exam Prep Questions and Correct Rationalized Answers

  1. Assassinglesmothersonsasverystightsbudget,sCiarasisstemptedstosskimpsonshersinsurance.sH owever,shersfriendsMehmetstellsshersnotstosskimpsonsinsurance,sbecausesitswillshelpsmana gesherscashsflows.sWhichsonesofsthesfollowingsexam-splessbestsillustratessMehmet'sspoint?s A. Ciarasneedssherscarstosgetstoshersjob,sandsshesneedsshersjobstosmakescarspaymentssa ndspaysforsherscarsinsurance. B. Whensherscar'sswindshieldsbreaks,sCiarashasstospaysonlys$100sofsthes$600scostsofsrepl acingsit. C. Whensherscar'sstransmissionsgoessoutsasmonthsafterstheswarrantysexpires,sCiarasissface dswithsas$1,100srepairsbill. D. Ciarasfindssitsdifficultstoscomesupswithsas$787sautosinsurancespremiumseveryssixsmonths.: sWhensherscar'sswindshieldsbreaks,sCiarashasstospaysonlys$100sofsthe $600scostsofsreplacingsit.
  2. Whichsonesofsthesfollowingsstatementssisscorrectsregardingsthesbenefitssprovidedsby sinsurance? A. Insurancesreducessthesfinancialsconsequencessofslosssexposuressbutsnotsthesrelateds uncertainty. B. Thesprimarysrolesofsinsurancesisstosmeetsmandatorysinsurancesrequire-sments. C. Thesreductionsinslossesspaidsbysinsurerssduestosriskscontrolsmeasuressbenefitssind ividualsinsuredssbutsnotssocietysassaswhole. D. Insuranceshelpssreducesthesfinancialsburdenstossocietysbyscompensatingsaccidentsvict ims.:sInsuranceshelpssreducesthesfinancialsburdenstossocietysbyscom- spensatingsaccidentsvictims.
  3. SheltonsIndustriessexperiencedsasfiresinsitssmanufacturingsplant.sSeveralsemployeesssu fferedsburnssandssmokesinhalationsinjuriessasstheystriedstosescapesthesbuilding.sWhichsones ofsSheltonsIndustries'scommercialsproperty-ca- ssualtyspoliciesswouldspaysforsthesemployees'sinjuriessandsillnesses?:sWorkersscompensati

2 s/s 113 onsinsurance

  1. Ashomeownersspolicysissastypesof:sPersonalsproperty-casualtysinsurancespolicy.
  2. Whichsonesofsthesfollowingscorrectlysdescribessasreasonsforsgovernmentsinvolvemen tsinsproperty-casualtysinsurance? A. Sellingsinsurancesprovidessthesgovernmentswithsasnon-taxssourcesofsrev- senuessandsprofits. B. Governmentsprogramsscansmeetslegitimatespublicsdemandssunmetsbyspri- svatesinsurers.

4 s/s 113 B. Risksmanagementsissconcernedswithspositivesandsnegativesrisks. C. Insuredsssharesthescostsofseachsother'sslosses. D. Insurancesbenefitsssocietysassaswhole.:sInsuredsssharesthescostsofseachsother'sslosses.

5 s/s 113

  1. Whichsonesofsthesfollowingsrepresentssuncertaintysaboutsoutcomessthatscansbesneg ativesorspositive? A. Losssexposure B. Transfer C. Risk D. Pooling:sRisk
  2. Coveragesforsmoneysandsothersbusinessspropertysfromsvariousscausessofslossssuchsass burglary,srobbery,stheft,sandsemployeesdishonestystypicallysissprovidedsby:sCommercialsc rimesinsurance.
  3. ThesinsurancesagentssuggestedsthatsSally'ssSnacksShopsbuysaspolicy thatscombinessproperty,scrime,sandsliabilityscoveragessintosonespolicy.sThississreferredstosassa (n):sCommercialsPackagesPolicys(CCP)
  4. Whichsonesofsthesfollowingsdescribessthescharacteristicssofsasmutualsinsur- sancescompany? A. Ascorporationsownedsbyspolicyholderssthatsprovidessinsurancestositsspoli-scyholders. B. Ansunincorporatedsassociationsthatsprovidessreciprocalscoveragestossub-sscribers. C. Ansunincorporatedsassociationsthatsearnssprofitssforsitssindividualsin-svestors. D. Ascorporationsownedsbysstockholderssthatsearnssprofitssforsthesstockhold- sers.:sAscorporationsownedsbyspolicyholderssthatsprovidessinsurancestositsspolicyhold-sers.
  5. Asreinsurancescompany A. Assumesslosssexposuressfromsasprimarysinsurer. B. Providessprimarysinsurancesforslosssexposuressthatsprivatesinsurerssaresunwillingstos provide. C. Issformedstoswritesallsorspartsofsthesinsurancesforsasparentscompany. D. Transfersslossesstosasprimarysinsurer.:sAssumesslosssexposuressfromsasprimarysinsurer.
  6. AutonomoussVehiclesApplicationss(AVA)sissasstart-upscompanysthatsdevel- sopsssafetystechnologiessthatscansbessoldstoscompaniessthatsaresproducingsau- stonomoussvehicles.sOnestechnologysAVAsissdevelopingsallowssansautonomoussvehiclestosde tect,sextract,sandsanalyzesimages;sandsthenstosrespondstosthesimages.sForsexample,sthestec

7 s/s 113 wassdeterminedstosbesashumansbeing,sthesvehicleswouldsslowsdownsorsstopsuntilsthescrosswa lkswassclear.sThisstechnology,swhichsissdesignedstoscapturesandsanalyzesimages,sandstosactson sthesrecognitionsofsthesimage;sisscalled:s-sComputersVision

  1. MutualsFundsCompanys(MFC)sofferssaswidesarraysofsmutualsfundsoptionsstosinvestors.s Eachsmutualsfundshassasdifferentsfundsobjectivesandssetsofsinvestmentsguidelinessthatsapp lystosthesfund.sWhilesMFCsgivessconsiderablesfreedomstositssfundsportfoliosmanagers,stheysar esrequiredstosabidesbysthesfund'ssinvestmentsguidelines.sTosmonitorscompliance,sMFCsdevel opedsascomputersalgorithm.sThescomputersalgorithmscontinuouslysmonitorsseachsfund'ssc om- splianceswithsinvestmentsguidelines.sIfsasfundsmanagersviolatessthesinvestmentsguidelines,s thescomputersimmediatelysnotifiessMFC'ssinternalscontrolsdirector,sandscorrectivesactionsiss taken.sMFC'ssusesofsthescomputersalgorithmstosmonitorsinvestmentscompliancesandstosprovi desnotificationswhenscorrectivesactionsissnecessarysillustratessusesof:sArtificialsIntelligence
  2. Thesprimarysrolesofsinsurancesissto:sIndemnifysindividualssandsorganizations forscoveredslosses
  3. Whichsonesofsthesfollowingsbestsdescribessthesconceptsofspooling? A. Insuredsssharesthescostsofseachsother'sslosses. B. Risksmanagementsissconcernedswithspositivesandsnegativesrisks. C. Thesfinancialsconsequencessofsunanticipatedslossessarestransferredstosansinsurer. D. Insurancesbenefitsssocietysassaswhole.:sInsuredsssharesthescostsofseachsother'sslosses.
  4. Astypesofsinsurersthatsissownedsbyspolicyholderssandsmayspaysdividendsstospolicyholder ssassasreturnsofsasportionsofspremiumsspaidsissa:sMutualsinsurer.
  5. ThesstatesofsMarylandsoperatessasresidualsautosplans(thesMarylandsAutosInsurancesFu nd — MAIF)sthatsprovidesscoveragesforsdriversswhosaresunablestosobtainscoveragesfromsprivatesin surers.sWhichsonesofsthesfollowingsissthesbestsrationalesforsthesMAIFsprogram? A. Privatesinsurerssfaceslimitedscompetition,sandsthesstatesincreasesscompeti- stivespressuressbysoperatingsthisstypesofsplan. B. Autosinsurancesisscompulsory,sandsthesprogramsmakessitspossiblesforsallsdriversstosha

8 s/s 113 vesreasonablyspricedsinsurance. C. Privatesinsurerssoverchargesforsautosinsurance,sandsthesstatesprovidessaslow- costsalternative. D. Autosinsurancesforshigh-risksdriverssissprofitable,sandsthesprogramsenables

10 s/s 113 ndsaccessiblestoseveryoneswhosneedssit. B. ThesU.S.sinsurancesindustrysissgovernedsbysfederalslawssthatsprotectscitizenssbyslevelingst hesplayingsfieldsforsinsurerssandspolicyholders. C. Insurancesregulationsspeaksstosthestypessofsriskssinsurerssmayscover,sbutsdoessnotspla ysaspartsinshowstheysinveststheirsprofits. D. Insurancesregulationspreventssinsurerssfromscoveringscatastrophicsoccur-

11 s/s 113 rencesssosinsurersscansremainssolvent.:sInsurancesregulationsprotectsscustomerssbysguarante eingsinsurancesissavailablesandsaccessiblestoseveryoneswhosneedssit.

  1. Allsofsthesfollowingsappearsonsansinsurer'ssbalancessheet,sEXCEPT: A. Liabilities B. Assets C. Netsincome D. Policyholders'ssurplus:sNetsincome
  2. Ansinsurer'ssbalancessheetscansbestsbesdescribedsassa A. Relationshipsbetweensrevenuesandsliabilities. B. Snapshotsofsitssfinancialsposition. C. Relationshipsbetweensassetssandsexpenses. D. Summarysofspremiumsswritten.:sSnapshotsofsitssfinancialsposition
  3. Allsofsthesfollowingsarescategoriessofsliabilitiessfoundsonsansinsurer'ssbalancessh eet,sEXCEPT: A. Losssandslosssexpensesreserves B. Policyholders'ssurplus C. Unearnedspremiumsreserves D. Othersliabilities:sPolicyholders'ssurpluss(Thesmajorscategoriessofsliabilitiessfoundsonsansins urer'ssfinancialsstatementssareslosssandslosssexpensesreserves,sunearnedspremiumsreserves,s andsothersliabilities.sPolicyholders'ssurplussissnotsasliabilityscate-sgory.)
  4. ThesfinancialsreportsforsHometownsInsurerscontainssthesfollowingsinforma-stion: Earnedspremiumss$4,000,000sWrittenspre miumss$5,000, Netsinvestmentsincomes$1,000,000sIncurr edslossess$3,000, Incurredsunderwritingsexpensess$2,000, WhatswassthesHometownsInsurer'sscombinedsratio?:s(3/4)s+s(2/5)s=s.115s(115%)
  5. Howsdosyousgetscombinedsratio?:sLosssRatios+sExpensesRatios=s(IncurredsLosses/Earne

13 s/s 113 Incurredsunderwritingsexpensess$4,000, WhatsissLMNsInsurance'ssexpensesratio?:s4/10s=s.4s(40%)

  1. Howsdosyousgetsexpensesratio?:sIncurredsunderwritingsexpensess/sWrittenspremiums
  2. Howsdosyousgetslosssratio?:sIncurredsLossess/sEarnedsPremiums
  3. Assitscontinuesstosgrow,sAnchoysInsurancesissexaminingsothersdistributionschannelsstos moreseffectivelysmarketsitssproducts.sThroughsthissexperience,swhichsofsonesthesfollowings willsAnchoysmostslikelyslearn? A. Nosmatterswhatsitsselects,sAnchoysmustsusesasproducerstoseffectivelyssellsitssproducts. B. Anchoyscansusesgroupsmarketingstostargetslargesnumberssofsrecentslocalscollegesgrad uates. C. Usingscallscentersswillstakesawaysitssneedsforscustomersservicesrepresenta- stivessorschatbots. D. Itswillsmarketsthroughsbankssandsfinancialsservicesswhensutilizingsthesex- sclusivesagencysdistributionschannel.:sAnchoyscansusesgroupsmarketingstostargetslargesnumb erssofsrecentslocalscollegesgraduates.
  4. SpencersInsurancesAssociatessissansindependentsagencyssellingsprimarilyshomeowner sspolicies.sThissagency A. Issfreestosworkswithsassmanysdifferentsinsurerssassitswants. B. Generallysrepresentssitsscustomerssrathersthansinsurancescompanies. C. Cansusesthespolicyholdersexpirationslists,sbutstheysaresownedsbysinsurers. D. Cannotscommitsansinsurerstoswritesaspolicy,sunlikesasbroker,swhosusuallyscan.:sIssfrees tosworkswithsassmanysdifferentsinsurerssassitswants.
  5. Theskeystosthesdirectswritersmarketingssystemsissthat A. Customersspurchasesinsurancesthroughscallscenters. B. Ansagencysisscontractedstossellsinsurancesforsonesinsurersorsgroupsofsinsurers. C. Thesinsurersissusingsitssownsemployeessassproducers. D. Customersscansgetsquotessforscoveragesthroughsweb- basedsportals.:sThesinsurersissusingsitssownsemployeessassproducers.

14 s/s 113

  1. Onesofsthesreasonssforsinsurancesregulationsisstospreventsdestructivescompetition.sIns whichsonesofsthesfollowingsscenariosswouldsdestructivescom-spetitionsbesexhibited?

16 s/s 113 miumss$5,000, Netsinvestmentsincomes$1,000,000sIncurr edsLossess$3,000, Incurredsunderwritingsexpenses$2,000, WhatsissHometownsInsurer'ssexpensesratio?:s2/5s=s.4s(40%)

17 s/s 113

  1. Theskeystosthesdirectswritersmarketingssystemsissthat A. Customersscansgetsquotessforscoveragesthroughsweb-basedsportals. B. Ansagencysisscontractedstossellsinsurancesforsonesinsurersorsgroupsofsinsurers. C. Customersspurchasesinsurancesthroughscallscenters. D. Thesinsurersissusingsitssownsemployeessassproducers.:sThesinsurersissusingsitssownsempl oyeessassproducers.
  2. Insuringsindividualsswithsashighsprobabilitysofslosssatsascostslowersthansthesinsurerswou ldsnormallyschargesforsthatsrisksbecausesitswasn'tsawaresofsthesactualsrisksinvolvedsissknow nsas A. Adversesselection. B. Unprofitablesbusiness. C. Policyholders'ssurplus. D. Capacity.:sAdversesselection.
  3. Claresissascommercialslinessunderwriter.sShesalwaysstriesstosfollowsunder- swritingsguidelines,seffectivelysevaluateslosssexposures,sandschargesadequatespremiums.s Bysdoingsthesesthings,sClare'ssgoalsisstosensure A. Adequatespolicyholders'ssurplus. B. Assignificantsbonus. C. Ascollaborativesrelationshipswithshersproducers. D. Adversesselection.:sAdequatespolicyholders'ssurplus.
  4. Whichsonesofsthesfollowingsstatementssisscorrectsregardingsthesinteractionsbetweensris kscontrolsandsothersinsurersfunctions? A. Riskscontrolsrepresentativessaresresponsiblesforscompilingsallsthesinforma- stionsrequiredsforsaspremiumsaudit. B. Riskscontrolspersonnelscansassistsunderwriterssinsmodifyingsasnewsappli- scant'sslosssexposuresstosmeetseligibilitysrequirements. C. Bysmakingsmarginalsaccountssacceptable,sriskscontrolshelpssthesClaimssDepartmen tssettleslosses.

19 s/s 113 torsstosensuresaccuratesclassificationsandspricing.sBriansissa A. Staffsunderwriter B. Corporatesunderwriter C. Fieldsunderwriter D. Accountsmanager:sFieldsunderwriter

  1. AimeesrecentlysacceptedsasjobsinsthesUnderwritingsdepartmentsatsNoblesInsurancesC ompany.sHersresponsibilitiesswillsincludesdevelopingscoveragesforms,sarrangingsreinsur ancesagreements,sandsconductingsunderwritingsau- sdits.sWhichsonesofsthesfollowingsissthestitlesofsAimee'ssnewsjob? A. FieldsUnderwriter B. UnderwritingsTechnician C. CorporatesUnderwriter D. LinesUnderwriter:sCorporatesUnderwriters(Corporatesunderwriters,ssometimessreferredsto sassstaffsunderwriters,sperformsdutiessincluding:sdevelopingscoveragesforms,sarrangingsreinsur ance,sconductingsunderwritingsaudits,sresearchingsthesmar- sket,sandsrevisingsunderwritingsguidelines.)
  2. Assansexperiencedsunderwriter,sRickshasslearnedstosmakeseveryseffortstosavoidsasm istakesthatscansproducesinsufficientspremiumstoscoverslosses,sorspricingsthatsisn'tscom petitive.sWhichsonesofsthesfollowingsunderwritingsmistakesscansoftenscausesthesesissu es? A. Misclassifyingsexposures B. Recommendingsthesapplicantsimplementsriskscontrolsmeasures C. Usingspredictivesmodels D. Adjustingspolicystermssandsconditions:sMisclassifyingsexposuress(Misclassificationsofsex posuresscansproducesinsufficientspremiumstoscoverslossessorspricingsthatsisn'tscompetitive.)
  3. Whichsonesofsthesfollowingsissastemporarysagreementsprovidingsinsurancescoveragesun tilsthesformalspolicysississued? A. Binder

20 s/s 113 B. Ratingsclassification C. Booksofsbusiness D. Submission:sBinders(Asbindersissastemporarysagreementsprovidingsinsurancescoveragesu ntilsthesformalspolicysississued.)

  1. Thessizesofsansemployer'sslosssexposuresforsworkersscompensationsinsur- sancesissbasedson