Minnesota Real Estate Exam Practice Question
The premiums for Workers' Compensation and General Liability are based on estimates at the start of the policy. After the policy expires, the insurer will adjust the premium to reflect the actual exposures the insured had during the policy period. This process is called
Correct Answer: D
Rationale: The process described involves evaluating the actual exposures after the policy period to adjust premiums accordingly, which is known as an audit.
Option A, a policy endorsement, refers to changes made to the policy terms during its term, not adjustments based on actual exposure.
Option B, an installment, relates to the payment structure of premiums rather than the adjustment process post-policy.
Option C, experience rating, involves adjusting premiums based on the insured's claims history over multiple periods, rather than the specific audit of exposures after a policy ends.
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