CU Insurance Products & Coverage Types 3

Question 1

Which type of annuity contract guarantees a fixed interest rate during the accumulation phase, shielding the owner from market risk?

Accepted Answer

Fixed annuity

Answer

A fixed annuity credits a predetermined interest rate set by the insurer, providing predictable growth without market exposure.

Question 2

Under a Workers' Compensation policy, Part Two — Employers Liability covers:

Accepted Answer

Lawsuits by employees alleging employer negligence beyond statutory limits

Answer

Employers Liability (Part Two) covers common-law suits by employees or their families that fall outside the exclusive-remedy provisions of workers' comp statutes.

Question 3

A 'floater' or 'inland marine' policy is BEST suited to insure:

Accepted Answer

Scheduled high-value items that move from location to location

Answer

Inland marine (floater) policies cover property that is mobile or in transit, such as jewelry, cameras, or contractor's equipment.

Question 4

The 'replacement cost' valuation method in a property policy differs from 'actual cash value' (ACV) because replacement cost:

Accepted Answer

Pays the cost to repair or replace without a depreciation deduction

Answer

Replacement cost pays to restore property to its pre-loss condition without subtracting depreciation, while ACV deducts for age and wear.

Question 5

Professional Liability (Errors & Omissions) insurance is specifically designed to cover claims arising from:

Accepted Answer

Negligent acts, errors, or omissions in professional services

Answer

E&O policies respond to claims alleging a professional failed to perform services with the expected standard of care.

(CU) Certified Underwriter Practice Test

(CU) Certified Underwriter Practice Test

CU Insurance Products & Coverage Types 3