CAS Practice Exam 2026 – Complete Study Guide

The correct choice highlights that both the location and type of business are significant factors that can impact public exposures between two premises. The location influences the demographics of the clientele, traffic patterns, local crime rates, and the general environment surrounding the business. For example, a business situated in a busy urban area will likely have higher foot traffic and thus greater public exposure than one in a remote rural area.

Additionally, the type of business also plays a crucial role; different industries attract different levels and types of public foot traffic. A restaurant or entertainment venue may have higher exposure compared to an office building with limited visitor access. This combination of location and business type creates varying degrees of risk and liability that are essential for understanding public exposure in insurance contexts.

In contrast, the other factors, while they can influence business operations or risks to some extent, do not encapsulate the broader public exposure aspect as effectively as the chosen option. For example, the size of the premises or the age of the building may relate to capacity or safety features but do not directly address the public interaction. Similarly, while operational hours may affect when the public is present, they do not inherently determine the overall exposure profile compared to the interplay of location and business type. Thus, the focus on location