Preview Questions Underwriter | Role Specific Skill

Question 1: When assessing risk, how does an underwriter factor in liquidity risk for a borrower seeking a large loan?

Which action should you take?

Choose only one option

By considering the long-term stability of the borrower's real estate assets

By applying a higher interest rate to mitigate liquidity concerns

By evaluating the borrower's ability to meet short-term obligations from liquid assets

By relying on the collateral's market value to secure the loan

Question 2: How does the use of collateral affect the risk evaluation of a loan application?

Which action should you take?

Choose only one option

It lowers the probability of default and loss severity

It increases operational complexity in underwriting

It increases the borrower's perceived creditworthiness

It has no significant impact on risk evaluation

Question 3: Which of the following economic indicators would most significantly impact an underwriter's decision to approve a loan?

Which action should you take?

Choose only one option

Employment rates

All of the above

Interest rate trends

GDP growth rate

Question 4: In the case of a complex claim dispute, what role does an underwriter play in maintaining regulatory compliance during the review process?

Which action should you take?

Choose only one option

Ensure that all claims are reviewed according to the terms and conditions of the policy and in line with regulatory standards

Delay the review to reduce the potential financial exposure

Settle the dispute immediately to avoid legal complications

Ignore the dispute and refer it directly to claims management

Question 5: How does an underwriter evaluate the risk of an applicant for disability insurance?

Which action should you take?

Choose only one option

By offering the same risk assessment to all applicants

By only focusing on the applicant's medical history

By using predictive models for economic performance

By considering the applicant's occupation, health history, and lifestyle choices

Question 6: How should an underwriter assess policy exclusions when reviewing a complex corporate insurance policy?

Which action should you take?

Choose only one option

By evaluating the premium structure based on exclusions alone

By cross-referencing exclusions with regulatory requirements

By identifying potential gaps that could leave the insurer exposed to high-risk claims

By ensuring exclusions align with the company's risk appetite only