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2021 Sep IIA-CFSA study guide
Q71. (Topic 4)
________ are insurance company representatives with the authority to sell the company’s product.
A. Brokers
B. Dealers
C. Agents
D. Both A & B
Answer: C
Q72. (Topic 4)
Which of the following would not generally be a responsibility of an underwriting department?
A. Helping policy owners with requests for information, interpreting policy language,answering questions regarding policy coverage
B. Verifying that the mortality/morbidity rates of the company’s insurers do not exceed the rates assumed when the premiums were calculated
C. Considering the applicant’s age, weight, physical condition, personal/family history, andother factors to determine the degree of risk
D. Negotiating and managing reinsurance agreements.
Answer: A
Q73. (Topic 1)
Auditors define audit objectives based on information gained:
A. From external sources of the organization
B. Either from knowledge they already have or from inquiries and observations
C. From internal sources of the organization
D. From external sources of the organization
Answer: B
Q74. (Topic 1)
Management must ___________ assess business risk and develop clearly defined control objectives:
A. Continually
B. Annually
C. Periodically
D. Weekly
Answer: A
Q75. (Topic 5)
A manufacturer wants to protect the company from financial loss resulting from third-party lawsuits. The manufacturer has learned of several recent jury awards over $7 million for product defects. The manufacturer currently has only $5 million in this type of coverage. The manufacturer has also learned that several automobile claims have been recently awarded against other company’s cars in accidents over $1 million. The manufacturer has damaged his competition and the manufacturer wants to protect his company further than the current policy allows. What insurance coverage product will the manufacturer likely buy?
A. A personal injury protection (PIP) policy to protect others from personal injury
B. An umbrella policy to place a protective umbrella over existing coverage.
C. A surplus lines policy to protect against claims in surplus of the policy limits.
D. A floater policy to float coverage where needed.
Answer: B
Most recent IIA-CFSA free draindumps:
Q76. (Topic 5)
A participant’s right to receive partial or full benefits under a private retirement plan even if the participant terminates employment prior to retirement is referred to as
A. Contributing.
B. Accumulating.
C. Vesting.
D. Non-revocation.
Answer: C
Q77. (Topic 3)
__________ agency system uses agents who sell the policies of a group of affiliated companies.
A. Multiple-line (or all lines) agency system
B. Personal selling distribution system
C. Career agency system
D. None of these
Answer: A
Q78. (Topic 4)
Which of the following is/ are the responsibility /ies of state insurance commission:
A. Making the State’s insurance rules and regulations
B. Authorizing companies to operate in the state through the issuance rules and regulations
C. Authorizing companies to operate in the state through the issuance of licenses andcertificates of authority
D. Both of these
E. None of these
Answer: C
Q79. (Topic 3)
General liability insurance covers the major liability exposure of a business, including lawsuits against an organization’s facilities or products. General liability insurance does not cover:
A. Liabilities that a business incurs through the use of its automobiles
B. Liabilities that a business incurs through the use of its labor and machinery
C. Liabilities that a business incurs through the use of its land and other capital products
D. All of these
Answer: A
Q80. (Topic 3)
Asset/liability management is a planning tool designed to maximize earnings. ALM tries to create optimal risk/reward decisions and focuses on creating prices that achieve a desired spread. A sound ALM policy must manage many types of risks such as:
A. Credit risk
B. Liquidity risk
C. Capital risk
D. All of these
Answer: D