ARM401 Practice Exam Questions 

The ARM™ 401 exam questions are tough. The ARM™ 401 exam consists of 75 multiple choice questions broken up into two sections, part A and part B. 

Let’s look at an example of a Part A and Part B question. Below we will breakdown two sample questions, including an answer and full explanation, from the ARM 401™ exam. These questions are written by AssociatePI, though we do not offer an ARM 401™ course at this time I do recommend this study material from AB Training Center. This is the study material I use; it includes practice questions much like the question and explanations in this blog.

ARM 401™ Sample Exam Questions – Part A

All of the following can reduce the property damaged caused by a flood, except?

  1. Building external walls
  2. Install shutoff valves
  3. Elevate electronic equipment
  4. Build a home on sturdy soil such as clay or limestone


Answer: D) Build a home on sturdy soil such as clay or limestone

Building on sturdy soil or clay does not reduce flood loss.

Preventative actions to reduce flood damage include:

  • Analyze structural integrity of buildings in flood zones.
  • Set up flood barriers or walls and plan for sandbagging.
  • Evaluate each building site’s flood potential.
  • Store electrical equipment above flood level (elevate electronics)
  • Shutter building openings.
  • Keep emergency supplies and portable power equipment.
  • Avoid open flames and lights in flood-exposed buildings.
  • Protect flammable gas piping and install shutoff valves.
  • Seal lower-level openings against entry of flood water.


For more Part A questions, download our free ARM 401 practice exam.

ARM 401™ Sample Exam Questions – Part B

Which of the following is a loss exposure associated with trade secrets?

  1. XYZ Company files a patent on their new radio wave technology device.
  2. Bill, the CEO of NTC Corporation, discloses the company’s trade secret only to the COO and CFO as they both need the trade secret to perform their jobs.
  3. ABC Company discovers the secret recipe of Big Bagel Company’s bestselling bagel sandwich.
  4. JUST TEES Company, a T-shirt manufacturer, suffers a decline in sales due to poor reputation after the company CEO layoffs 100 employees to increase his bonus.


Answer: C) ABC Company discovers the secret recipe of Big Bagel Company’s bestselling bagel sandwich.

There are two loss exposures associated with trade secrets. The two loss exposures are:

  1. The risk of inadvertent disclosure of the secret
  2. The risk that another party will later discover and patent the same secret

In this case, ABC Company discovers the trade secret. This is an example of a trade secret loss exposure.


On your exam, you will be given a scenario like the one seen above; it is your job to understand what is being asked of you and how to solve or recommend a solution to the scenario.

For more scenario based questions, download our free ARM 401 practice exam.

Free Practice Exam

Ready to get started studying? We’re here to help (for free). Download our free ARM™ 401 practice exams to get a feel for the type of questions you will see on the exam.

Download: Free ARM™ 401 Practice Exam

More Information

For more information about the ARM™ 401 exam, checkout some of our other free resources:



Difficulty rank, importance rank, and the advice provided in this resource are solely the opinion of AssociatePI. This resource is intended to provide you with a general idea of where your focus should be. Each exam administered by The Institutes is different. AssociatePI is not affiliated with The Institutes or involved in the exam writing process. Please be sure to thoroughly study every chapter and every topic of this course.

ARM™ exams are administered by the American Institute for Chartered Property Casualty Underwriters (“The Institutes”). AssociatePI does not administer the actual exams, we are an independent resource of free content, advice, and study material for professional insurance education. This blog is intended for informational purposes only, to inform prospective students of the benefit of the ARM™ designation.

CPCU®, ARM™ and API are trademarks of the American Institute for Chartered Property Casualty Underwriters (“The Institutes”). AssociatePI LLC is not affiliated with, associated with, endorsed by or otherwise supported or recognized by The Institutes in any way. AssociatePI LLC is not authorized by The Institutes to offer courses, practice examinations, or any other resources related to the Institutes’ designations or other programs.

For further information, please email [email protected].

October 11, 2019

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