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IIC Principles and Practice of Insurance Sample Questions:
1. Which statement describes a primary function of a telephone adjuster?
A) Authorize repairs suggested by the staff adjuster
B) Act as a liaison between the intermediary and the insurer
C) Process a large volume of claims
D) Process all paperwork for independent examiners
2. What is the annual premium for a building insured for$500,000at a rate of$0.80 per $100?
A) $6,250
B) $800
C) $2,500
D) $4,000
3. Which statement reflects the concept that the premium for each risk should be commensurate with that risk?
A) Risks more likely to have losses should pay higher premiums
B) Proper settlement of losses should be paid out of the pool of funds
C) One or more persons should provide protection to another person against loss
D) Risks can happen to anyone, so each individual should purchase insurance
4. Which factor could explain poorer performance of renewal clients as opposed to new business clients?
A) New business clients limit claims in order to keep premiums low
B) Reinsurance only being available on renewal policies
C) An automated renewal process
D) More strict underwriting criteria for renewal risks
5. Mark was involved in an at-fault accident one year ago. As there was minimal vehicle damage and no apparent injuries, Mark settled with the third party and did NOT report the accident to his insurer. Today, Mark has been served a statement of claim alleging long-term injuries. Which action will Mark's insurer MOST LIKELY take, and why?
A) Pay the claim because Mark's current policy must respond to a liability claim
B) Deny the claim because Mark had forfeited the right of recovery
C) Pay the claim because accident benefit coverages have no expiration date
D) Deny the claim because a limitation period is in effect
Solutions:
| Question # 1 Answer: C | Question # 2 Answer: D | Question # 3 Answer: A | Question # 4 Answer: A | Question # 5 Answer: B |




