SOFE SOFE Certifications AFE Questions & Answers

• Question 81:

  Changes in existing policies that may result in additional premiums or return premiums, such as increases or decreases in coverage limits, in:

  A. Endorsement

  B. Audit premiums

  C. Change plan

  D. Policyholder dividends

  Correct Answer: A

• Question 82:

  In which account current, for individual policies, the agent collects the premiums directly from the insureds, subtracts his or her commissions and remits the net premiums due to entity?

  A. Billing basis

  B. Paying commission basis

  C. Item basis

  D. Bushiness costs

  Correct Answer: C

• Question 83:

  The agents submit to the insurance entity a statement of all policies issued or due during the current month, and the net amount of the statement is subsequently to be paid in accordance with the agency agreement, is an account current of:

  A. Insurance billing

  B. Direct billing

  C. Rendering basis

  D. Billing basis

  Correct Answer: C

• Question 84:

  If claims have been reported to the insurer after the contract period, it may several months for the insurer to investigate and establish a case reserve for reported claims.

  A. True

  B. False

  Correct Answer: B

• Question 85:

  In which policies the contract provides for insurance coverage for a fixed period of duration and enables the insurer to not renew the contract or adjust the provisions of the contract at the end of the contract period?

  A. Short duration

  B. Policy duration

  C. Contract duration

  D. None of the above

  Correct Answer: A

• Question 86:

  Insurance policies may be classified in which of the following categories?

  A. By policy planning

  B. By type of risks coverage

  C. By kind of insurance underwritten

  D. All of the above

  Correct Answer: C

• Question 87:

  What are batched, and input control totals are established before delivery to data entry?

  A. Coded applications

  B. Billing premiums

  C. Issuing policies

  D. Business applications

  Correct Answer: A

• Question 88:

  The two basic methods for billing premiums are:

  A. policy and direct billing

  B. agency and direct billing

  C. collecting and indirect billing

  D. business and direct billing

  Correct Answer: B

• Question 89:

  The adjustments of the premium during the period of coverage based on actual experience during that same period are called:

  A. Policy rating

  B. Schedule rating

  C. Experience rating

  D. Retrospective Experience rating

  Correct Answer: D

• Question 90:

  Which of the following is NOT the type of Merit rating?

  A. Policy rating

  B. Schedule rating

  C. Experience rating

  D. Retrospective Experience rating

  Correct Answer: A