CPCU® 520 Exam Format

In this blog, we will break down the exam format along with the most important topics of the exam. These are the topics that you must memorize to be prepared for this exam. These topics come straight from our CPCU® 520 online course where we provide a detailed breakdown of the most important topics of each chapter, along with our difficulty and importance rank for each chapter.

CPCU® 520 Exam Format

The CPCU® 520 exam is a 65-minute virtual exam consisting of 50 multiple-choice questions. Exams are virtual, and non-proctored, meaning you take the exam alone online directly from your computer.

All questions on the virtual exam will be application-based scenario questions. These are tricky questions that require you to apply your knowledge to a real-life scenario to choose the appropriate answer (you will not be repeating a definition or concept). You will be given a real-life scenario; your job will be to select the best recommendation to solve the given scenario.

You can download one of our free practice exams to see what these questions look like.

CPCU® Question Format

The CPCU® 520 questions will be formatted in a similar manner to the CPCU® 500 exam questions. These questions require you to fully understand every aspect of the main topics and require you to actually apply the knowledge, rather than just repeating a definition. You will NOT be simply repeating a definition.

The CPCU® 520  exam consists of 50 multiple-choice questions. You will have 65 minutes to complete the exam. That means, you only have about 1 minute and 18 seconds per exam question. That’s not a lot of time. You need to memorize all of the content of this exam to be able to quickly read, analyze, and correctly answer each scenario-based question.

There are two primary types of questions on this exam:

Concept questions – We found it best to practice concept questions formatted in a question stated as “All of the following are true, except” and “Which of the following is true in regards to…”. For example, reinsurers provide insurance for primary insurers. All of the following statements are true in regard to reinsurers except? As another example, reinsurers provide insurance for primary insurers. Which of the following statements are true in regard to reinsurers? These are common exam question formats, we recommend you practice using this format to master the concepts to the CPCU® 520 exam. This will help to prepare you for the questions you will see on the actual exam.    

Case questions – We found it best to practice two types of case questions for the CPCU® 520 exam:

  • Calculation questions – using the calculations covered on the CPCU® 520 exam. For example, calculate the gross margin given a revenue of $1,000,000 and cost of goods sold of $500,000.
  • Analysis question – analyzing a real life scenario to select the best answer. For example, ABC Insurance’s current year combined ratio is 90% and loss ratio is 70%. Last years combined ratio was 95% and loss ratio was 70%. Which is true in regards to ABC’s expense ratio?

CPCU® 520 – Exam Topics

The major focus of the CPCU® 520 exam is the insurance company, insurance departments, and insurance functions. The main topics covered in this exam include insurance operations, regulations, underwriting, claims, reinsurance, and premium auditing. For more insight, see our blog about the CPCU® 520 Exam Difficulty

Download: Free Practice Exam (CPCU® | ARM™ | AINS™ | API™)

CPCU® 520 – Important Topics

Below we are outlining some important CPCU® 520 exam topics. This is our opinion of the topics that are important on your exam.

  • Underwriting – there are two chapters focused on underwriting on this exam. A chapter on underwriting personal insurance and a chapter on underwriting commercial insurance. These are important topics. Pay close attention to these chapters. Be sure to understand the different types of underwriters (field underwriters and corporate underwriters), the underwriting process, the financial reports, and the portfolio management process.
  • Reinsurance – we recommend you heavily focus on reinsurance, in our opinion this is one of the most important topics of the CPCU® 520 content. Understand the reinsurance process, calculate how much the reinsurer will pay for a loss, and know the best reinsurance contract for an insurer given a specific scenario.
  • Marketing – we highly recommend you master the topics of insurance marketing and distribution. Know the best distribution system given the characteristics of the customer and insurer, understand the insurance market, and know the marketing process.

Disclaimer

Remember, every CPCU® exam is different. No single exam is the same. Be sure to study ALL topics (not just our recommendation). This resource is intended to provide you with a general idea of where your focus should be. Make sure to thoroughly study every topic of this exam.

Two Final Tips:

1) Read the entire online course and focus on the details: Remember to practice with questions that ask “Which of the following is true” or “All of the following is true, except”, you might see questions formatted like this on your exam. These questions require that you know all of the minor details and differences between each CPCU® 520 topics so be sure to fully read through the course and memorize all minor details because these questions will try to trick you by changing one little detail!

2) Practice, practice, practice: Practice makes perfect. The only way to prepare for the type of questions you will see on the CPCU®520 is to take as many practice exams as you possibly can. This will help you familiarize yourself with the CPCU® 520 question format and help you determine which topics you need to re-study.

Free Practice Exam

Ready to get started studying? We’re here to help (for free). Download our free CPCU® 520 practice exams to get a feel for the type of questions you will see on the exam.

Download: Free Practice Exam (CPCU® | ARM™ | AINS™ | API™)

More Information

For more information about the CPCU® 500 exam, check out some of our other free resources:

Disclaimer

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.

CPCU® 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 CPCU® designation.

CPCU® 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 contact@associatepi.com.

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