Question 27

A primary reason that a surplus lines insurer would be the best choice for providing single event liability and event cancellation insurance is

Select one:

A. Reduced premiums when compared to the admitted market.

B. Excessive loss frequency making the risk unacceptable to admitted insurers.

C. Underwriting expertise and specialty forms for this exposure.

D. Unusually high limits that the risk requires.

Question 28

A start-up business is exploring the possibility of building underwater communities where residents would live, work, and play. A surplus lines insurer would be a good choice for this company primarily because

Select one:

A. Admitted insurers would charge excessive premiums to insure the exposures of this business.

B. Regulations affecting the business would be too cumbersome for admitted insurers to manage.

C. Admitted insurers would be unable to expand their coverage territory to cover this exposure.

D. Surplus lines insurers are able to identify and respond to newly emerging risks and meet the insurance needs of those customers.

Question 29

Question text

A resort in eastern Washington state has expanded its property to the extent that it requires a building property blanket limit of $20 million. A surplus lines insurer would be a good candidate for this coverage primarily because admitted insurers

Select one:

A. Do not have the appropriate forms and endorsements to cover such property.

B. Seldom have the capacity to write a risk of this size.

C. Would be unwilling to write business in this territory.

D. Have little expertise in insuring resort property exposures.

Question 30

The quality of the insurer's claim-handling is

Select one:

A. An essential element of the insurance product.

B. Rarely a determining factor in an account's purchasing decision.

C. Irrelevant to insureds with large deductibles.

D. Unrelated to the services provided by most insurance products.