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Bundle of FLORIDA ADJUSTER updated 2023 (Graded A)
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Florida Adjuster Licensing Practice Exam 2023 Questions with 100% correct Answers
A claim in the property/casualty industry Is defined as: - ANSWER-an assertion of an alleged legal right against a person, entity, company or insurer that ... [Show More] carries with it a demand for money as compensation for injuries or damages when you purchase insurance, you are buying: - ANSWER-peace of mind that if an insured event does occur, that the insurance company will keep its promise and provide the financial protection that you purchased in today's society, the most important factor in the purchase of insurance is: - ANSWER-trust One of the most important claim handling goals of an insurance company is: - ANSWER-to help those who have been injured or who have suffered loss for which the insured is responsible, while at the same time minimizing loss for the insured party and carrier what is the primary difference between a company employee adjuster and an independent adjuster - ANSWER-a company employee adjuster works for an insurance company and an independent adjuster works independently for themselves or for adjusting firms who represent many clients an adjuster's responsibility as a fiduciary means: - ANSWER-the adjuster represents, and controls, the property and financial interests of the client to whom he/she owes a high degree of loyalty and good faith the basic and primary functions of an adjuster are: - ANSWER-investigating, evaluating, reporting, negotiating and disposing of claims once an adjuster is licensed, he or she must maintain a continuing education requirement. What is that adjuster's compliance requirement in order to retain a license? - ANSWER-an adjuster must complete 24 hours of continuing education in every 2 year compliance period, of which 5 hours must be taken in a properly certified 5 hour law and ethics update course the adjuster's code of ethics starts with a basic premise which states: - ANSWER-the work of adjusting engages the public trust Which of the following would NOT be a preferred claims practice or behavior under FL Unfair Insurance Trade Practices Act? - ANSWER-Not responding to an insured calls because you haven't made up your mind what are the four critical elements of a contract? - ANSWER-1. agreement to terms (must understand what is given and received) 2. adequate consideration for the promises made 3. legal capacity of the parties to contract 4. contract must have legal purpose an insurance policy is often referred to as a contract of adhesion which means: - ANSWER-if any of the wording or language in the policy is vague or ambiguous, making it difficult to understand or interpret, the law is well settled that the interpretation shall be in favor of the party who did not control its terms (the policyholder) breach of contract by a carrier or its adjuster through non-payment or on-compliance with policy requirements, could have the following consequences for a carrier - ANSWER-if found guilty of a breach of contract, the carrier could be punished with a "bad faith" verdict that would cost it millions of dollars what are the fundamental parts of an insurance policy? - ANSWER-1. Declarations Page 2. Insuring Agreement 3. Exclusions 4. Conditions What is one of the duties of an insured following a loss? - ANSWER-giving prompt notice of loss to the insurer describe the difference between a peril and a hazard - ANSWER-a peril is a cause of loss, like fire. A hazard is a condition that exists beforehand that increases the likelihood of such a loss, like a messy storeroom or garage the doctrine of proximate cause is defined as - ANSWER-if there is an unbroken chain of events, or series of consequences, flowing from the initial loss caused by the insured peril to a subsequent loss, the insured peril causing the initial loss will be considered the "proximate cause" of the subsequent loss A couple had Coverage A limits of $250K on their home located in FL. A tornado spawned by Hurricane Ernesto damaged their roof resulting in estimated repair costs of $11,500. The adjuster deducted the FL hurricane deductible of $5,000 from the estimate and paid them $6,500 in settlement of their property claim. This is known as the application of: - ANSWER-a percentage deductible (hurricane deductible) A restaurant was damaged after a grease fire erupted in the kitchen. Damage to the structure totaled $78,300. The owner's commercial property policy provided Coverage A limits of $250,000 with a deductible of $1,000. How much would the policyholder be paid? - ANSWER-$$77,300 a couple has insured their home for $150,000. a fire ensues and guts their home, resulting in a total loss. An appraisal of the home prior to loss results in a value of $120,000, yet the adjuster is required by law to pay the couple $150,000. This is known as the application of: - ANSWER-valued policy law Assume that 5 years ago a couple insured their home for its then appraised value of $60,000. 2 weeks ago they had a stove fire resulting in an estimated loss of $15,000. The adjuster finds that the value of their home is now $100,000 but the home is still only insured for $60K and there is a deductible of $500. The policy has an 80% coinsurance clause. How much should the adjuster pay to the couple? - ANSWER-($15,000-$500)($60,000/$100,000(.80))= $10,875 describe the coverage's provided in a split limit policy of 10/20/10 - ANSWER-the coverage provides up to $10,000 of liability protection for bodily injury to any one individual, an aggregate of $20,000 for all bodily injuries regardless of how many individuals, and $10,000 for property damage negligence is described as - ANSWER-fault that arises from doing something you shouldn't have done, or not doing something you should have done what are examples of "compensatory damages"? - ANSWER-tangible, documentable financial losses such as medical expenses and lost wages (special damages) intangible losses such as pain and suffering, mental anguish, permanent injury and disfigurement (general damages) What are the defenses to a claim of negligence - ANSWER-no negligence, contributory negligence, comparative negligence and assumption of risk what are the laws that affects one's legal liability - ANSWER-Statutes of Limitations, Wrongful Death Act, Workers comp. and Auto No Fault, Waiver of Sovereign Immunity and Breach of Product Warranty What statement is NOT true? - ANSWER-if a question of coverage arises and can't be swiftly resolved in favor of the insured, the carrier should immediately tender the claim to its attorney and deny the claim [Show Less]
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Florida Public Adjuster State Test with complete solutions
Florida Public Adjuster State Test with complete solutions
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Florida Claims Adjuster Exam 2023 with complete solutions
Severability - ANSWER-Insurance applies separately to each insured as if other insureds did not exist. Abandonment - ANSWER-Property insurance policies ... [Show More] usually contain a(n) __________ clause, *stating the insured cannot dump damaged property on the insurer and demand its full value.* Insurable Interest - ANSWER-One wherein economic loss would be suffered from an adverse happening to the subject. Liberalization - ANSWER-States that if the insurer adopts a revision which would broaden coverage without additional premium within some period of time prior to the policy period or during the policy period, the insured receives the benefit of such broadened coverage.. Doctrine of Proximate Cause - ANSWER-States that when there is an unbroken connection between an occurrence and damage that grows out of the occurrence, then the resultant damage is all a part of the occurrence. Actual Cash Value - ANSWER-The Loss Settlement Valuation that subtracts an allowance for depreciation Warranty - ANSWER-A policy condition, either based on information in the insured's application or inserted by the insurer Conditional Contract - ANSWER-The Insurer's responsibility to pay for a property loss may be conditioned on the insured having used reasonable means to avoid the loss, to protect the property against further loss, and to give the insurer proof of the loss is defined as? Under Mechanical Breakdown Coverage, *new cars are eligible for service up to:* - ANSWER-36 Months/36,000 Miles Used vehicles: 12 Months/12,000 Miles If financial responsibility doesn't exist at the time of an accident, what happens? - ANSWER-The legally valid claims of others must be satisfied (10/20/10) The owner and operator must provide certification of future responsibility for future accidents As to required proof for future accidents by purchase of auto liability insurance, the insurer must make a filing (Form SR-22) certifying that coverage is in effect, and this certification must remain on file for __________ years - ANSWER-3 The Business Automobile Policy includes all of the following coverage forms except: - ANSWER-The Trailer Interchange Coverage Form Personal Injury Protection, or PIP, has a __________ per person, per accident limit. - ANSWER-10,000 Used to insure businesses engaged in selling, servicing, repairing, parking or storing automobiles: - ANSWER-Garage Coverage Form The following examples are referred to as __________ liability limits: 25/50/25 or 10/20/10. - ANSWER-Split 10/20/10 = 10,000 per person injured 20,000 all injuries combined 10,000 property damage Example of straight liability limit = $30,000 Jeremy has a not at fault accident. If he has PIP with a $1,000 deductible, how much can he expect his PIP coverage to pay toward his medical bills that total $3,000? - ANSWER-$1,600 3000 (bills) - 1000 (deductible) = 2000 x .80 (eighty percent) Frank has a not-at-fault accident, he has basic PIP, no deductible and Med pay of $5,000. How much will his Med Pay contribute to medical bills of $15,000? - ANSWER-$5,000 Medical Payment limits apply per person; Frank will receive full amount towards medical bills. Which of the following is not one of the rating factors for a Homeowner's Policy? - ANSWER-Age & Gender of Insured On a Homeowner's Policy, covers items that are not permanently attached to the dwelling. This is defined as: - ANSWER-Other Structures Examples include sheds, fences, pool houses, detached car ports, etc. A lender has an insurable interest in a home and finds protection in the: - ANSWER-Mortgagee Clause Mortgagee - Homeowner's policy Loss Payee - Automobile policy Which of the following forms is "all-risk" on the dwelling policy? - ANSWER-DP-3, or the Special Form When the basic liability limits provided by the policy are insufficient for an insureds needs, two coverage forms are used to provide the additional amounts of coverage: A. Excess Liability B. Umbrella C. Both A & B D. None of the Above - ANSWER-Both A & B Which of the following is not covered under Coverage C, Personal Property? A. A fire breaks out in the residence and an overnight guest loses his clothes in the fire B. A fish dies because he has been left alone for a week without food C. The insureds daughters tennis racket is stolen from her locker D. The insureds suitcase and clothing, valued at $1,500, are stolen from his hotel - ANSWER-B. A fish dies because he has been left alone for a week without food Animals are listed as an "exclusion" under a Homeowner's policy. All of the following are eligible for a Homeowner's Policy, except? A. An apartment tenant B. A condominium owner C. Four-family dwelling owner-occupant D. A business condo owned by a local insurance company - ANSWER-D. A business condo owned by a local insurance company Commercial property is not eligible for a Homeowner's policy. Which of the following are characteristics of Homeowner's Insurance? A. Protects against economic loss to residences and household property and legal liabilities B. Owner-occupants of 1-4 family dwellings C. Renters who maintain residential occupancy in any type of building D. All of the Above - ANSWER-D. All of the Above Also included: personal, non-business risk, no more than 2 roomers/boarders, condominium unit owners and cooperative apartment occupants Jeremy owns a home that is recently damaged due to a hurricane. The repair estimate is averaged at $25,000 and Jeremy decides to stay in a hotel because most of the damage is to his bedroom and kitchen. Under a Homeowner's Policy, what coverage will pay for the hotel room bill? A. Fair Rental Value B. Value Obligation C. Loss of Use D. Insurers Duties - ANSWER-C. Loss of Use The insurer will pay any necessary and reasonable expenses associated with a daily living routine. An insured who wishes to purchase flood insurance, but is located in a moderate or low risk flood zone may do so by purchasing a: - ANSWER-Preferred Risk Flood Policy Although Flood Insurance is provided by the Federal Government, those who are not in a "flood zone" may purchase a preferred risk policy to cover them for a flood claim. Used only for Commercial Condominiums, it covers the unit-owners business personal property and the personal property of others in the insured's care, custody or control: - ANSWER-Condominium Unit Owners Form The Commercial Property Contract includes all of the following, except: A. Common Policy Conditions B. Commercial Property Conditions C. Coverage Form D. Commercial Loss Schedule - ANSWER-Commercial Loss Schedule Also included: Declarations, Causes of Loss Form, Endorsements Insures a condominium association against direct physical loss or damage to buildings, business personal property and personal property of others in the care, custody or control of the association and located at the premises: - ANSWER-Condominium Association Form This, along with Condo Unit Owners Form, is located under Condo Coverage. Sometimes referred to as commercial fire and allied lines, this is the form of insurance that covers direct and indirect losses related to properties other than one-to-four family dwellings and farm properties: - ANSWER-Commercial Property Insurance (the question is the definition for this term) Under Commercial Property Policies, Florida law requires an insurer to give the insured at least __________days advance written notice of non-renewal. A. 25 B. 90 C. 45 D. None of the Above - ANSWER-C. 45 Also, notice must state reasons the policy is not to be renewed. When a business's personal property values fluctuate, a single, fixed amount of insurance could produce either over- or under-insurance at any given time. With this option, the limit of coverage is set at an amount somewhat higher than expected peak values. - ANSWER-Value Reporting Replacement Cost is incorrect b/c it calculates monetary value of one's personal property Liberalization states, "The insured gets the benefit of any broadened coverage if the company, within __________ days of inception, adopts a form revision that is broader and without increase in premium." - ANSWER-45 days Used to cover buildings in the course of construction - ANSWER-Builders Risk Policy Includes: structure being built (including foundations), fixtures and machinery, equipment to service building, owned materials and supplies used for construction. Temporary structures built or assembled on site are also included if not covered by insurance. First developed as an extension of Ocean Marine coverage, to provide coverage for cargo traveling over land, instead of by sea. - ANSWER-Commercial Inland Marine Coverage Definition: to help identify kinds of risks which are eligible for either Ocean or Inland Marine insurance. Protects against *loss of business income* that results from damage to covered property from a covered cause of loss. (BIIC) - ANSWER-Business Income Insurance Coverage Period of restoration begins 72 hours after date of direct damage. In effect, coverage has a 72 hour deductible. Coverage ends on either 1. date when damaged property could be repaired, rebuilt, or replaced 2. date business resumes operations at new, permanent location (whichever comes first) What payment covers several areas of costs related to [Show Less]
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Adjuster Pro - Florida Certified Adjuster Glossary Exam Questions and Answers
Accumulated Depreciation - ANSWER-The total decrease in an item's value over a period of time. Formula: (Annual Depreciation x Number of years used) Act... [Show More] ual Cash Value (ACV) - ANSWER-A valuation method used by insurers to reflect an item's current market value right before being damaged or destroyed. Formula: (Replacement cost - Accumulated Depreciation) Adhesion - ANSWER-One of the characteristics of an insurance contract. Means that one party (the insurer) sets the terms, and the other (the insured) can 'take it or leave it.' Adjusted Gross Revenue (CropInsurance) - ANSWER-Narrowest (and least expensive) form of Crop Revenue Insurance. Insures farm revenue as a whole instead of individual crops. Guarantees a percentage of the insured farm's average revenue. Adjuster - ANSWER-An agent who, for compensation, processes insurance claims. Can represent either the insured or the insurer. Adjuster - Emergency - ANSWER-Adjusters who are temporarily licensed by the insurance commissioner to handle claims during catastrophes or emergencies that produce an overwhelming number of claims in a short period of time. Adjuster - Independent - ANSWER-Self-employed adjusters who contract with multiple insurers at the same time. Paid on a commission or fee-plus-expenses basis for each claim. Also called: Fee Adjuster, Bureau Adjuster Adjuster - Public - ANSWER-An adjuster who is hired to represent the claimant and help determine a fair indemnification.Usually specializes in appraisals and negotiation. Paid commission, usually a percentage of final settlement. Adjuster - Staff - ANSWER-Salaried employee of one insurance company who can work locally, regionally, or nationally. Also called: Company Adjuster Advance Payment Settlement - ANSWER-A settlement option that lets the insurer offer some financial relief to the claimant before the claim has been fully settled. The insurer makes advance payments to the claimant, which are then subtracted from the final settlement amount. Often used when a claimant suffers bodily injury and is unable to work. Agency Authority - ANSWER-The Agent's authority to act on behalf of someone else, usually an insurer. This authority is derived from the agent's contract with the insurer. Agency Authority - express - ANSWER-Authority that is expressly given to the agent in writing. Allows agent to act on behalf of the principal. Aency Authority - implied - ANSWER-Authority that an agent possesses by implication of his behavior, regardless of whether this authority is expressly granted in writing. Agency Authority - apparent - ANSWER-Authority that an agent possesses based on the appearance of representing an insurer. Agent - ANSWER-Someone who has received authority from an insurer to sell or service insurance policies. Aggregate Limit - ANSWER-A type of policy limit found in some health, liability, and property damage policies. It represents the total amount the insurer will pay for all losses. Agreement - ANSWER-One of the four requirements of a legally binding contract. All parties involved must agree to the terms of the contract. Can also refer to a binder, which is the preliminary substance of a contract. Agricultural Producer - ANSWER-A business that grows, harvests, and sells crops for profit. Aleatory - ANSWER-A characteristic of insurance contracts; means depending on an unknown future event." Answer - ANSWER-In liability cases, the defendant's response to a complaint. There are three possible answers: 1)accept complaint and pay for damages, 2) deny the complaint, or 3) accept the complaint with a right to insert evidence into the case. Annual Depreciation - ANSWER-An item's Replacement cost divided by the number of years in its expected lifespan. Appraisal - ANSWER-A negotiation method which allows the claimant and the insurer each to select an appraiser.The two appraisers in turn select an Umpire. The appraisers then work together to determine asettlement amount. If they cannot agree, the Umpire steps in. Agreement by any two of thethree is binding. Arbitration - ANSWER-A negotiation method in which the opposing parties each submit their evidence to a mutually-agreed-upon and neutral third party, called an arbitrator. The arbitrator reviews the positions ofeach opposing side, and makes a final and legally binding decision. Arbitrator - ANSWER-The mutually-agreed-upon and neutral third party in an arbitration who reviews the positions ofeach opposing side, and makes a final and legally binding decision. Auto Policy - ANSWER-Insurance policy designed to protect the policyholder while owning, occupying, or operating avehicle. Usually combines liability coverage and property coverage into one policy. Automobile - ANSWER-In Insurance policies, Automobile generally means any vehicle designed for use on publicroads. Automobile No-fault Laws - ANSWER-Insurance that indemnifies the insured regardless of who was at fault in an accident; also restrict the insured's right to sue the at-fault party. Aviation - ANSWER-Aviation insurance combines hull insurance for the aircraft and liability insurance for any damage to others' property or to people who are not passengers. Bailee - ANSWER-An individual or company that receives the property of someone else for a special purpose, and returns the product after use. BAP - ANSWER-The Business Auto Policy provides property damage and liability insurance for automobiles used by a business. Binder - ANSWER-A temporary contract provided by an insurer that ensures coverage until the complete, permanent policy is issued. BI - ANSWER-(Bodily Injury): Physical damage to someone's person. Body Language - ANSWER-The signals we give through posture, behaviour, apparel, etc., which are involved in communication. Boiler & Machinery - ANSWER-Insurance designed to indemnify a business for damages to, and damages by, boilers, machinery, motors, generators and a variety of other electrical devices and appliances. Bond - ANSWER-A contract wherein one party guarantees the performance of a third party. Bonds involve three parties: (1) the surety agrees to pay the second party (2) the obligee if the third party (3) the principal neglects to carry out an obligation it has to the obligee. Breach of Product Warranty - ANSWER-The failure or falsehood of a stated promise of a product stipulation. Business Personal Property - ANSWER-Moveable property used for business Catastrophe - ANSWER-An occurrence or a sequence of occurrences that causes enormous property losses; normally uninsurable by private insurers. Cause of Loss - ANSWER-A form included in a Commercial Package Policy or a Commercial Property Policy that lists the causes of loss from which the insured property is covered. CGL - ANSWER-A Commercial General Liability policy protects businesses against damages and injuries to thirdparties. Civil Law - ANSWER-Observes court cases of one citizen charging another citizen for damages caused by tort; it differs from criminal law. Claim - ANSWER-The "offer of settlement" that the policyholder files with an insurer after she experiences a loss. Claims-made Form - ANSWER-A liability policy in which the insurer pays only those claims arising during the policy period (as opposed to those claims arising after the policy period is over, regardless of whether the incident took place during the policy period). Claims Management - ANSWER-The practice of the insurance adjuster of managing a claim by processing it in a prompt and effective manner from the time the claim is filed until a settlement is reached, while adhering to all local and federal laws. Claimant - ANSWER-One who files a claim with an insurer for a loss. Claude the Clueless Adjuster - ANSWER-In this course, Claude the Clueless Adjuster represents an incompetent or unprofessionaladjuster. Coarse Grains - ANSWER-In Crop Insurance, a provision that covers reduction in crop quality, as well as crop-yield losses.Coarse grains are corn, grain sorghum, and soybeans. See also "Small Grains". Coinsurance - ANSWER-The portion of a covered claim that the insured is responsible for paying out-of-pocket after the deductible has been paid. Code of Ethics - ANSWER-A set of governing professional standards of conduct, usually created by regulatory bodies or government regulatory agencies. These standards may also be formally codified with statutes. Coercion - ANSWER-The practice of forcing another party to behave in an involuntary manner (whether through action or inaction) by use of threats or intimidation or some other form of pressure or force. Commerce - ANSWER-The exchange or transport of goods or property. Commercial - ANSWER-Having to do with commerce or business activity in general. Commercial Crime Insurance - ANSWER-Insurance that covers employee dishonesty and theft by employees or others. Commercial Lines - ANSWER-A variety of insurance coverages that protect those involved in the business of creating, selling,displaying, evaluating, or shipping, etc. Example include: Business Owner's Policy; CommercialProperty; Commercial General Liability; Workers Compensation; Professional Liability (D&O),Errors and Omissions (E&O) and Employment-Related Practices Liability. Commercial Property Floater - ANSWER-A means of protecting a business' property that is not in one fixed location. Common Law - ANSWER-Based on court decisions and customs when statutory law does not provide an answer; creates precedent. Compensatory Damages - ANSWER-Money awarded in civil court for tangible and intangible damages caused by a policyholder Compensatory damages -Special - ANSWER-Money awarded for the exact value of the physical damage caused to the plaintiff up to the trial date; objective value determined by receipts and medical bills. Compensatory damages -General - ANSWER-Money awarded for the emotional losses of the plaintiff that will continue after the trial date; subjective value determined by the court. Competence - ANSWER-One of the four qualifications of a legally binding contract. All parties must be competent, with the necessary legal and mental capacity. Complaint - ANSWER-Initiates a civil lawsuit by a claimant requesting financial relief from damages caused by a policyholder. Concealment - ANSWER-The act of withholding relevant material facts from an insurer. Conditions - ANSWER-The section of a policy that qualifies or limits an insurer's promise to pay or perform. Consideration - ANSWER-One of the four qualifications of a legally binding contract. All parties must bring something of value to the contract. Contract - ANSWER-An agreement entered into voluntarily by two parties or more with the intention of creating a legal obligation. Coverages - ANSWER-The amount and extent of protection provided by an insurance policy. Crime - ANSWER-An offense against the State or Federal Government, or a breach of law, for which the offender shall make satisfaction to the public. Criminal - ANSWER-Someone who has been convicted of a criminal act in a court of law. Crop Hail Insurance - ANSWER-A form of Crop Yield Insurance that is usually provided by private insurers without government subsidy. It offers named-peril protection on an acreage basis. Crop Insurance - ANSWER-Insurance coverage designed to protect a farmer's financial investment in his or her crops; covers losses to a crop's profitability. Crop Revenue Insurance - ANSWER-Crop insurance that combines crop-yield insurance and price insurance to protect against losses to crop value. Crop Yield Insurance - ANSWER-Crop insurance that covers losses to actual crops. Damages - general - ANSWER-Intangible losses such as pain and suffering, or mental anguish. Damages - special - ANSWER-Tangible, financial losses that can be documented. Dangerous Instrumentality Doctrine - ANSWER-States that anyone involved in the use of inherently dangerous products or machines is held100% liable for their own damages. Dec Page - ANSWER-First page of a policy, which provides a summary of the contract; includes names of insured, addresses, coverage limits, policy period, etc. Declined Coverage - ANSWER-Takes place when an insurance company rejects an application for coverage. Deductible - ANSWER-The amount the policyholder must pay out-of-pocket before the insurance company will pay the remaining costs. Deductible - fixed - ANSWER-A fixed deductible is one specific, predetermined amount that a policyholder must pay out-of-pocket before he can be indemnified. Deductible - percentage - ANSWER-A deductible that is calculated as a percentage of a covered loss. Deductible - franchise - ANSWER-States that the policyholder only pays for damages that are less than his deductible. If the cost of damages equals or exceeds his deductible, the insurer pays the full amount and the policyholder pays nothing. Defamation - ANSWER-Damage to another's name or reputation, whether by libel, which is in print or by slander, which is in speech. Default Judgement - ANSWER-Default Judgement is entered by the court against the party who failed to defend against a claim brought on by another party. In other words, if the person fails to show up and answer the claimthe court will find in favor of the other party. Definitions - ANSWER-Page in policy that gives specific limited meaning to terms used in policy. Depreciation - ANSWER-A decline in value of property caused by wear or loss of usefulness usually measured by aspecific formula. Direct Loss - ANSWER-Physical harm to tangible property caused by a peril. Discoverable - ANSWER-Capable of being demanded and handed over as evidence in a court of law; during litigationproceedings, the adjuster's claims file is discoverable. Eligiblity - ANSWER-Eligibility Requirements are found in some insurance policies. They identify the conditions thatmust be met by the policyholder in order to qualify for coverage under a policy. Endorsement(s) - ANSWER-An optional provision that can be added to a policy to increase, reduce, or modify coverage forspecific property types or perils. Errors and Omissions - ANSWER-Liability insurance that indemnifies professionals for errors or oversights on the part of theinsured that caused harm to their clients. Estoppel - ANSWER-A legal principle that bars a party from asserting something contrary to what has been impliedby his previous actions or statements. Ethical - ANSWER-Adhering to moral laws and to principles of fairness. Evaluation - ANSWER-Evaluation, determining the approximate value of damages relevant to a claim i.e. total ofmedical bills, costs of repair & replacement of damaged property and the consideration of thefinancial provisions of the insurance policy. Exclusions - ANSWER-A section of an insurance policy that reduces coverage by listing specific individuals, property,or perils that are NOT covered by the policy. Exposure - ANSWER-The extent to which an item is open to damage or loss. More exposure means a loss is morelikely. Fair Credit Reporting - ANSWER-Federal legislation that gives an applicant for insurance the right to investigate the reasons hisinsurance application was denied. Fall Down Case - ANSWER-A lawsuit brought against a property owner by someone who has fallen down on the property. False Advertising - ANSWER-Presenting something in a deceptive or untrue manner to the consumer; misrepresentations inadvertisements. Farm - ANSWER-A property where a farmer or rancher both resides and conducts commercial business. Farmer - ANSWER-Someone in the business of growing, harvesting, and selling crops for profit. In Farm insurance,a farmer must reside and do business on the same premises. FEMA - ANSWER-Federal Emergency Management Agency - a branch of homeland security that coordinatesrelief programs when disaster strikes an entire community. Fiduciary - ANSWER-One of the terms that describes the adjuster's relationship with the principal (the insurer). AsFiduciary Agent, the adjuster acts for the benefit of the principal, rather than for his own benefit. First Named Insured - ANSWER-The first person [Show Less]
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Florida 6-20 All Lines Adjuster Exam Review 2023 Questions and Answers
The deductible - ANSWER-The dollar amount that the insured pays before the insurer is required to pay the remainder of the loss is known as? Replacement... [Show More] cost - ANSWER-Which loss settlement provides new for old? the claims adjuster's role in the insurance industry includes - ANSWER-Give appropriate legal advice and write binding contracts following are examples of a peril - ANSWER-Lighting, Explosion and Fire The abandonment clause - ANSWER-The clause that prohibits the insured from dumping damaged property on the insurance company and demanding to be paid in full is? Liberalization - ANSWER-When a policy change results in broadened coverage with no additional premium, the insured automatically receives the benefit under the principle of? Risk - ANSWER-The chance of financial loss is known as? Percentage - ANSWER-Hurricane insurance in coastal areas in Florida is written subject to which of the following deductibles? Severability - ANSWER-Insurance may apply separately to each insured, as if the other insureds did not exist. This is known as the doctrine of? The principle of proximate cause - ANSWER-When there is an unbroken connection between an occurrence and the damage that arises from the occurrence, and all the resulting damage happened on account of that occurrence, this is known as? characteristics of a contract - ANSWER-Consideration must be given to at least one party Primary - ANSWER-When two or more policies apply to the same loss, the one that pays first is called? Mortgagee Clause - ANSWER-The clause that protects the lender in a real property policy is the? Indemnity - ANSWER-The concept that one should not profit from the payment provided by an insurance policy is known as? Property or first-party insurance - ANSWER-Payment the insurance company makes directly to the insured is? Written - ANSWER-To be considered an insurance contract, a policy must be? Subrogation - ANSWER-When the insured transfers his/her rights to collect for damages to the insurer, it is known as? The insured - ANSWER-If an insurance policy is unclear or ambiguous, in whose favor does the policy respond? Insurable interest - ANSWER-A partial owner of a building cannot receive full value for the building in the event of a loss because of? Comparative negligence - ANSWER-Reduces the insured's damages by the degree of negligence the following are part of an insurance policy - ANSWER-Exclusions, Declarations and Endorsementd ACV - ANSWER-replacement cost minus depreciation The insured's house is totally destroyed in a fire. The house is insured for $200,000. The adjuster who investigates the claims determines the ACV of the home is $185,000. - ANSWER-The Florida Valued Policy Law requires the insurer to pay $200,000 describe a franchise deductible - ANSWER-No payment is made until the loss equals or exceeds the amount of the deductible and then the loss is paid in full All of the following are characteristics of an insurance contract EXCEPT? Personal, Private, Conditional, Adhesion? - ANSWER-Private If a claimant is represented by an attorney, the adjuster should? - ANSWER-Only meet with the client when the attorney is present Adjusters should advise claimants on? - ANSWER-claims information An adjuster is required to notify a claimant when a claim is denied. The notification must be? - ANSWER-Written The term ethics refers to? - ANSWER-service to others, personal respect and proper mode of conduct When an adjuster deals with a claimant who is not a policyholder, this claim is known as an? - ANSWER-third party claim The successful adjuster/negotiator should understand that communication includes all of the following EXCEPT? Select one: A. Verbal and non-verbal messages B. Questioning C. Listening D. Decision-making - ANSWER-Decision-making Which of the following is not a duty of the claims adjuster? Select one: A. Investigating B. Evaluating C. Negotiating D. Counseling - ANSWER-Counseling The adjuster's duty to the insurer is best described as? Select one: A. Friendly B. Factual C. Fun D. Fiduciary - ANSWER-Fiduciary Errors and Omissions claims are a result of? Select one: A. unethical behavior B. lack of knowledge or information C. Both unethical behavior and lack of knowledge or information are correct D. Neither unethical behavior and lack of knowledge or information are correct - ANSWER-Both unethical behavior and lack of knowledge or information are correct Unethical behavior affects? Select one: A. The claimant B. The adjuster C. All of the above D. The entire company - ANSWER-All of the above All of the following are components of negotiating EXCEPT? Select one: A. The issue should be negotiable B. There must be an exchange of value for value C. The parties should trust each other D. The claimant must be satisfied - ANSWER-The claimant must be satisfied The Civil Remedies Provision of the Insurance Code states that adjusters should not? Select one: A. Handle claims in a prompt manner B. Accompany claims payments with statements explaining coverage C. Settle claims in good faith D. Try to influence settlements - ANSWER-Try to influence settlements The insured, a resident of Florida, was in an accident in Georgia. The Florida car was insured with liability limits of 10/20/10. Georgia's minimum liability limits are 20/40/10. How will the Florida policy respond? Select one: A. 10/20/10 B. 20/40/10 C. No coverage D. 20/40/20 - ANSWER-20/40/10 Under a PAP, when does the insurance company cease to defend the insured? Select one: A. The insurance company is not obligated to defend the insured B. After the case has been resolved C. When the policy limit is exhausted D. At the policy's expiration - ANSWER-When the policy limit is exhausted The Florida Financial Responsibility Law is triggered by? Select one: A. Registration of the vehicle B. Purchase of the vehicle C. An accident involving bodily injury or property damage D. Purchase of an auto policy - ANSWER-An accident involving bodily injury or property damage The insured is an owner and is insured for PIP. She is injured in an accident and has the following damages? medicals-$12,000, lost wages-$6,000. How much will PIP pay if there is a $1,000 deductible? Select one: A. $11,200 B. $12,400 C. $9,600 D. $10,000 - ANSWER-$10,000 Trucker insurance premiums are based on all EXCEPT? Select one: A. Radius B. Age of the driver C. Type of business D. Territory garaged - ANSWER-Age of the driver Joe works for Sinks-R-Us, Inc. As part of his compensation package, he is supplied with a company car, which he gets to take home every night. Joe wants to make sure the Liability coverage under his PAP covers him while driving his company car. What coverage would you add to Joe's PAP? Select one: A. Named Non-owned coverage B. Extended Non-owned Liability coverage C. Drive Away Liability coverage D. False Pretense coverage - ANSWER-Extended Non-owned Liability coverage Dan has a Personal Auto Policy with Liability of 10/20/10 and basic PIP with a $1,000 deductible. He is running one day when a car strikes him. A week later he dies. Medical bills are $7,500 and lost wages are $1,000. How much, if any, will PIP pay in this claim? - ANSWER-10,800.00 Joe is an owner insured for PIP. In which of the following situations does Joe have his PIP benefits available to him? Select one: A. In a slip and fall accident in the mall in Florida B. In an accident while riding his motorcycle C. Struck as a pedestrian in Georgia D. In an accident while riding as a passenger in a friend's car in Florida - ANSWER-In an accident while riding as a passenger in a friend's car in Florida The insured bought a new car with a Mechanical Breakdown Policy. When the odometer reaches 40,000 the car has a serious breakdown involving the transmission. How does the Mechanical Breakdown Policy respond? Select one: A. No coverage because the policy expired B. No coverage because a transmission is not covered C. ACV coverage will apply D. Replacement cost coverage will apply - ANSWER-No coverage because the policy expired An insured borrows his neighbor's trailer to pick up his new furniture. Which of the following best describes the insured if he has an accident? Select one: A. His PAP will extend coverage if the proper endorsement is added B. Only the liability of the PAP extends to the trailer C. His auto is insured, but not the borrowed trailer D. His PAP extends liability to the trailer and Part D-Physical Damage extends $1,500 coverage to the borrowed trailer - ANSWER-His PAP extends liability to the trailer and Part D-Physical Damage extends $1,500 coverage to the borrowed trailer Jane is driving Mary's car. Jane has an at-fault accident with Bob. Mary has liability limits of 10/20/10. Jane has liability limits of 100/300/100. If Bob has $40,000 in bodily injury, how much will be collected from Jane's policy? (IGNORE PIP) Select one: A. $30,000 B. $10,000 C. $50,000 D. $20,000 - ANSWER-$30,000 Jim owns an auto and he is involved in an auto accident. He suffered $4,000 in medical expenses and $4,000 of lost income. How much does his insurance pay if he has Extended PIP? Select one: A. $7,200 B. $8,200 C. $4,200 D. $5,200 - ANSWER-$7,200 If an insured has $100,000 of unstacked UM coverage with three cars on the policy, how much is available under a UM claim? Select one: A. $0- B. $300,000 C. $100,000 D. $200,000 - ANSWER-$100,000 The insured has a PAP with single liability of $50,000. The following loss occurs: $37,000-BI pedestrian; $3,000-Display window; $10,000-Sports car; $1,500-Legal defense. How much would his policy pay for the loss? Select one: A. $51,500 B. $37,000 C. $40,000 D. $50,000 - ANSWER-$51,500 The insured is driving down the road when a low hanging branch strikes and cracks his windshield. The cost to replace the windshield is $650. The insured has a $500 collision deductible and a $250 other than collision deductible. The insurance company will pay...? Select one: A. $250 B. No coverage C. $500 D. $650 - ANSWER-$650 [Show Less]
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Florida all lines Adjuster Exam 2023 with complete solutions
Liability insurance policies are what kind of contracts - ANSWER-third party contracts third party contracts do what - ANSWER-promise to pay on behalf o... [Show More] f the insured all damages two forms of legal liability - ANSWER-civil and criminal liability what is a tort - ANSWER-A civil wrong who is the tortfeasor - ANSWER-someone who committed the tort joint tortfeasor - ANSWER-two or more people who commit a single tort in civil lawsuit, the tortfeasor is referred to as - ANSWER-the defendant in civil law, the injured person bringing the suit is referred to as - ANSWER-the plantiff how are torts addressed by insurance policies - ANSWER-intentional, unintentional or liability without fault intentional tort acts are - ANSWER-committed with intent, may still be covered if consequences of the action were not intended what are the 7 intentional torts - ANSWER-1. Battery 2. Assault 3. False Imprisonment 4. Intentional Infliction of Emotional Distress 5. Trespass to Land 6. Trespass to Chattels 7. Conversion unintentional torts are known as - ANSWER-negligence what is negligence - ANSWER-failure to use ordinary or reasonable care Vicarious or imputed negligence is - ANSWER-unintentional tort where act is not directly attributable to the insured common form of vicarious liability - ANSWER-relationship between employer and employee aka pizza delivery guy hitting pedestrian strict or absolute liability - ANSWER-imposed by statutory law that involve inherent danger activities involving inherent danger include - ANSWER-dangerous materials, hazardous operations or animals Bodily injury is defined as - ANSWER-bodily harm,sickness, disease or death property damage is defined as - ANSWER-direct physical damage to tangible property including the loss of use to prove negligence what must be established - ANSWER-the actions not only caused injury or damage but also was the proximate cause of the loss The foreseeability test is used to determine what - ANSWER-tests whether negligent party should have reasonably foreseen the consequences that resulted from action common law consists of what - ANSWER-behaviors and customs that have never been written into the law statute law is what - ANSWER-written law of states For a liability policy to pay a claim, the person who is legally liable - ANSWER-must be insured under the policy what are compensatory damages - ANSWER-damages awarded by the court to pay for actual losses by the plaintiff in a lawsuit two categories of compensatory damages - ANSWER-special damages and general damages what are compensatory special damages - ANSWER-awards for actual economic losses such as medical expenses , lost wages , and property damages caused by defendant what are general compensatory damages - ANSWER-compensate for losses of intangible nature such as pain and suffering do full tort coverages have a high or low premium - ANSWER-much higher premium than limited tort what are punitive damages - ANSWER-damages exceeding simple compensation and awarded to punish the defendant. contributory negligence - ANSWER-A common law defense stating that if individuals contribute to their own loss in any way, then the defendant cannot be held liable for the loss many states have declared the contributory negligence rule as harsh and have adopted the - ANSWER-comparative negligence rule comparative negligence - ANSWER-the purpose is to reduce a plaintiffs damage award by the plaintiffs percentage of negligence if the plaintiff was awarded $50,000 in damages but found to be 10% negligent in the cause of loss, their award would be reduced to - ANSWER-50,000 X .10=5,000- 50,000= $45,000 Pure Comparative Negligence - ANSWER-reduced to the percentage of injured partys negligence modified comparative negligence - ANSWER-if the plaintiff is 50% or more at fault for the loss, they cannot collect an award for damages what are the 3 defenses against negligence - ANSWER-assumption of risk intervening cause statute of limitations assumption of risk - ANSWER-A defense against negligence that can be used when the plaintiff was aware of a danger and voluntarily assumed the risk of injury from that danger. what is intervening cause - ANSWER-An independent factor breaks the chain of causation and becomes the proximate cause of loss what is statute of limitations - ANSWER-the statutory defense that imposes a time limit in which the plaintiff can file a lawsuit what are the three types of limits expressed in liability policies - ANSWER-single limit, split limits and aggregate limits "Single limit" in liability policies - ANSWER-highest amount the policy will pay for any one accident or occurrence, intended to cover Bodily injury and property damage "Split limits" are most frequently used in what kind of policies - ANSWER-automobile policies the first limit in the split limit policies is - ANSWER-the maximum amount paid for any one person for bodily injury per occurrence the second limit in the split limit policies is - ANSWER-the maximum amount paid for ALL people injured per occurrence the third limit in the split limit policies is - ANSWER-the maximum amount the policy will pay for property damage per occurrence what is the aggregate limit in a liability policy - ANSWER-the maximum amount the policy will pay for all occurrences during the policy period what happens what the insured reached the aggregate limit - ANSWER-the insured is without coverage The definition of occurrence - ANSWER-a continuous or repeated exposure to an event that results in a financial loss liability insurance policies are written on which two forms? - ANSWER-either a "claims-made" or "occurrence" form Why would someone choose a liability insurance policy to be written on "occurrence forms" - ANSWER-to cover liability claims when the occurrence took place during the policy period regardless of when the claim was filed why would someone choose a liability insurance policy to be written on a "claims-made form" - ANSWER-to provide coverage for claims only when both the occurrence and the resulting claim filling takes place during the policy period, if filed after the policy expiration date it will not be covered what is the "duty to defend" - ANSWER-insurer has the right and duty to defend the insured, even if the claim is groundless, false or fraudulent What is malfeasance? - ANSWER-legal term used in both civil and criminal law to describe an intentional act is illegal or morally wrong that contributes to the injury of another person no-fault coverage - ANSWER-any type of insurance contract under which insureds are indemnified for losses, regardless of who was at fault What is nonconcurrency - ANSWER-when an underlying liability policy and excess liability policy have different inception and expiration dates, a denial of a claim can occur when can the excess liability policy occur - ANSWER-excess policy cannot pay on a claim until the underlying policy's limits have been exhausted what are supplementary payments - ANSWER-items such as first aid expenses, premiums for bonds, pre- and post- judgement interest and travel expenses incurred by the insured at the request of the insurance company in defense of a claim which type of insurance is not intended to indemnify the plaintiff? - ANSWER-punitive damages this would be considered compensatory or special damages paid to an injured party when the insured is negligent and causes the injury? - ANSWER-lost wages Eligible Dwelling Under a Homeowners Policy - ANSWER-owner or tenant occupied 1-4 family dwelling up to 5 roomers or boarders incidental business occupancy permitted Mobile or trailer homes can be covered under which form - ANSWER-under the DP-1 form only if it is owner occupied and permanently installed The DP-1 policy period for mobile or trailer homes cannot... - ANSWER-cannot exceed one year Are farm dwellings eligible under dwelling insurance - ANSWER-Farm dwellings are NOT eligible The personal automobile policy (PAP) is used to cover individuals and families for.. - ANSWER-liability they may incur for bodily injury or property damage they cause to another person and to cover their own car for damage caused by an accident because the personal automobile policy provides both property and liability coverages, it is considered to be a .. - ANSWER-package policy Part A coverage for personal automobile policy is - ANSWER-Part A-Liability Part B coverage for personal automobile policy is - ANSWER-Part B- Medical Payments Part C coverage for personal automobile policy is - ANSWER-Part C- Uninsured motorists Part D coverage for personal automobile policy is - ANSWER-Part D- Coverage for damage to your auto (physical damage coverage) Eligibility for personal automobile insurance - ANSWER--4 wheel motor vehicles owned or leased for at least 6 months -private passenger autos that are 4 wheel motor vehicles,pickup trucks, and vans that are not over 10,000 lbs and not used for the delivery or transportation of goods bodily injury means - ANSWER-bodily harm, sickness, or disease, including death property damage means - ANSWER-Physical injury to, destruction of, or loss of use of tangible property. the named insured's "covered auto" includes - ANSWER-any vehicle listed in the declarations any "newly acquired auto" the insured obtains during the policy any "trailer" owned by the named insured What is a "temporary substitute vehicle" - ANSWER-any auto or trailer not owned by the named insured that is used as a temporary substitute vehicle that is out of service Which of the following is NOT one of the primary insuring agreements found in a standardized Commercial Crime policy? - ANSWER-"Extortion" coverage may be added by endorsement but it is not one of the primary insuring agreements included on the form. What kind of hazard would presented by applicants or insureds who would cheat, lie or commit other crimes to benefit from insurance coverage be - ANSWER-moral hazard laziness and apathy are what kind of hazards - ANSWER-morale hazards faulty wiring and electrical cords are what kind of hazards - ANSWER-physical hazards The retroactive date is applicable only on - ANSWER-a claims-made CGL policy and it establishes the date when that coverage begins under the current policy. are uninsured motorist first party or third party claims? - ANSWER-First party claims With a Commercial Package Policy (CPP), "interline endorsements" are endorsements that - ANSWER-are written to change more than one coverage part that is included in a Commercial Package policy. A performance bond guarantees - ANSWER-the owner that the bidder will complete the work at the price that was bid as per the contract specifications. Someone breaks down the door to a store and steals merchandise. This loss is known as: - ANSWER-burglary A "member" is defined as - ANSWER-a person serving in a directorial capacity for a limited liability company (LLC) under a standard Commercial Crime policy. The DP-3 standard Dwelling form provides - ANSWER-Open peril coverage on the dwelling and other structures and broad form peril coverage on contents Where in the insurance contract can an insured find the terms used throughout the policy and an explanation as to what they mean in the context of the policy? - ANSWER-The Definitions section Which of the following is the additional limit provided by a standard Businessowners policy "Debris Removal" in the event that the policy limit is exhausted in paying the loss? - ANSWER-The additional limit is $25,000 when the basic coverage provided by the policy is not enough If the Value Reporting Form Endorsement is attached to a Commercial Property policy, business personal property is covered at all of the following locations, EXCEPT - ANSWER-Exhibition locations are specifically excluded A "dual capacity" claim in workers' compensation is filed: - ANSWER-against an employer that was acting in a capacity "other than as an employer" at the time the injury occurred. This is not a covered peril for collapse under the commercial property additional coverage - ANSWER-A building that is in danger of collapsing is NOT covered under the additional coverage for "collapse" under a Commercial Property policy. World-wide liability coverage is provided for a period of 30 days for.. - ANSWER-autos the insured hires, leases, rents or borrows without a driver. The insured's liability is determined in a settlement agreed to by the insurer, or in a suit filed in the United States or its territories, possessions, Puerto Rico or Canada. The "principal" for an independent adjuster is the - ANSWER-insurer The "control of property" condition of the Commercial Property policy: - ANSWER-states that a negligent act of someone beyond the insured's direction or control will not affect the coverage. All loss or damage to property other than money and securities under a Crime policy is settled on - ANSWER-replacement cost basis Which of the following businesses can cover their private passenger and commercial automobile exposures with a Business Auto policy? - ANSWER-a grocery store An insured has purchased BAP physical damage coverage against specified causes of loss. Protection applies to all of the following perils, EXCEPT: - ANSWER-falling objects period of restoration begins - ANSWER-72 hours a [Show Less]
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Florida Adjuster Exam Questions with correct Answers
What is Insurance? - ANSWER-A financial tool that protects people from their losses. Transfers risk from one party to another: 1. Insured (people) purch... [Show More] ases an insurance policy 2. Insurer provides financial protection to the insured How does Insurance work? - ANSWER-1. Insured pays a premium 2. Insurer promises to pay for specified losses if they occur 3. Insurer's promise gives peace of mind to insured Spreading Risk (How Insurance works) - ANSWER-1. Collected premiums (from ALL insured) go into a pool called a "reserve" 2. Policyholder can file a claim for covered losses 3. After filing a claim, the insured becomes a claimant 4. Insurer pays for claims out of the "reserved" premiums 5. Reserve should always be enough to cover losses Principle of Indemnity - ANSWER-Restoration to previous financial condition; no more, no less. Indemnification - ANSWER-Being restored to the financial condition you were in before a loss Insurance Policy (ACCL) - ANSWER-1. Contract to provide financial protection for a fee 2. Legally binding because it meets the 4 requirements of a legal contract Four Qualification (Insurance Policy-Legal Contract) - ANSWER-1. Agreement: mutual consent (signature or handshake) 2. Consideration: all parties bring something of value (money in exchange for a car) 3. Competent parties: 18 years old, sober, and sane 4. Legal purpose: no contract for money laundering (has to be legal) Insured - ANSWER-Individual or organization that pays premiums in exchange for protection Insurer - ANSWER-Company, group, or government agency offering financial protection Risk (meaning) - ANSWER-When an insurer issues an insurance policy, the actual item, person, or organization that is being insured. Personal (Six Special Characteristics of Insurance Contracts) - ANSWER-The insured person is protected from losses; not the covered property D.I.C.E. - ANSWER-1. Declarations Page (aka "Dec Page")/Definitions Section 2. Insuring Agreement 3. Conditions 4. Exclusions/Endorsements Declarations Page ("Dec Page") - ANSWER-Makes contract specific to the policyholder (names of both parties; location & description of insured item; value of insured item; dates of the policy (beginning and end); amount and limit of coverage; deductible; and premium. Definitions Section - ANSWER-1. Not technically essential, but common in policies 2. defines terms used to write policy including: - "collision," "decay," "like kind and quality." 3. includes important language for adjusters to know Insuring Agreement Section - ANSWER-Insurer agrees: - what is covered - which causes of loss are covered - any service provided - any exclusions to coverage - the maximum limit of policy coverage in dollars Conditions Section - ANSWER-The Insurer specifies any limits or qualifications the policyholder must meet (example) Requiring a security guard for a jewelry store How to file a proof of loss How to protect the property after a loss Exclusions Section - ANSWER-List what the policy DOES NOT cover: Common Exclusions (in nearly all property policies) - earthquakes - flooding - war - nuclear hazards - intentional acts Endorsements Section Synonyms: Rider Addendum Attachment - ANSWER-Are additions to the policy that can: - add or reduce insurance coverage - change policy provisions - change the premium price after the policy period ends Types of Insurers - ANSWER-Insurance Companies Other Private Groups Government Entities Government Insurers - ANSWER-Non-profit Mandatory participation Benefits prescribed by law Designed to meet needs of general public Government has monopoly (meaning government has control) Private Insurers (Company) - ANSWER-Sell insurance based on consumer preferences Offer a wide variety of insurance products Typically exist to generate a profit or benefit a group (money) Insured party voluntarily Participates Types of Private Insurers - ANSWER-Private Commercial Insurers Stock Insurance Companies Mutual Insurance Companies Re-insurer Reciprocal Insurer Private Commercial Insurers - ANSWER-Operate for profit Collect premiums from policyholders A portion of premiums is reserved to pay claims Excess premiums become profit Stock Insurance Companies - ANSWER-Always for profit Usually publicly-traded Stockholders provide capital and participate in profits or losses "Non-participating" insurers: no dividends go to policyholders Mutual Insurance Companies - ANSWER-Owned by policyholders (no shareholders) Policyholders elect board of directors "Participating" insurers: policyholders participate in dividends Re-insurer - ANSWER-An insurer that provides insurance for other insurers Reciprocal Insurer - ANSWER-A group of people or organizations that insure each other Risk Retention Group (RRG) - ANSWER-A form of commercial insurer in which the members use their own capital to issue insurance policies Risk Purchasing Group - ANSWER-A group of people with similar insurance needs who form an organization to buy insurance as a group Private Non-Commercial Insurer - ANSWER-A not-for-profit insurance company that returns profits to policyholders by reducing premiums or expanding benefits (Blue Cross/Blue Shield) Speculative Risk (Insurers will NOT cover this Risk) - ANSWER-Is undertaken with no certainty of either gain or loss Is made knowingly, by conscious choice Cannot be insured Pure Risk - ANSWER-Is a risk with no chance of gain Can only result in either loss or no loss Can be insured Exposure - ANSWER-The possibility or likelihood of damage or loss - ANSWER- Hazard (Storing dangerous materials in a building; a record of drunk driving; smoking) - ANSWER-Anything that increases exposure Peril - ANSWER-The actual cause of loss or damage Loss - ANSWER-1. Reduction in value of an insured item 2. Expenses caused by a covered peril 3. The amount an insurer pays to settle a claim Two meanings of "Risk" - ANSWER-Potential for loss The insured item [Show Less]
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Florida Test Study Guide - Public Adjusting 3-20 (Set 1) latest updated
Those who are eligible for coverage under the Florida Automobile Joint Underwriting Association are? - ANSWER-Military Personnel A non-resident owning an... [Show More] automobile in Florida A non-resident subject to Florida no-fault law A forcible entry into locked premises and the carrying away of the property of others is a definition of: - ANSWER-Burglary The inland marine coverage form that covers clothing, cameras and other portable property worn and carried by tourists and travelers is a: - ANSWER-Personal effects floater A residual market to alleviate the temporary unavailability of property insurance coverage in significant portions of Florida (e.g. homeowners face non-renewal or cancellations) - ANSWER-Residential Property & Casualty Joint Underwriting Association for property owners. What does the property insurance term "improvements and betterment" apply to? - ANSWER-Real Property The penalty imposed upon a Florida licensee who violates a cease and desists order issued by the CFO: - ANSWER-$50,000 Fine What is amount is personal property used for business purposes, under a Homeowners policy covered up to - ANSWER-up to $2500 on premises up to $1500 off premises If a replacement costs exists, but the insured has a policy for only 50% of the replacement cost, what percentage will the insured received for the loss? - ANSWER-50% of the settlement amount A statement that is believed to be true when made, which my prove to be false. - ANSWER-Representation A statement that is guaranteed to be correct: - ANSWER-Warranty When can an insured cancel his/her policy? - ANSWER-At any time. In Florida, how many days in advance of a premium due date must an auto insurer provide notice of renewal to an insured? - ANSWER-30 days written notice What deductibles are subject to any aircraft physical damages that differ according to circumstances surrounding a given loss? - ANSWER-In-flight Ded (greatest amount) Not-in-Motion (least amount) They apply independently based on the actual loss Uninsured Motorist's Coverage form, the insured can request: - ANSWER-Non-stacked Coverage Stacked Coverage UM coverage at the limits lower than those that apply for liability coverage If a mortgage is acknowledged in the policy and the insured concealed the fact that a hazard exists to the insurance company, would the mortgage have a right to recover its full loan value? - ANSWER-Yes Under Florida Comparative Negligence law how much would one be able to recover if they were found 25% at fault? - ANSWER-75% (the difference) If a claimant is under the influence of drugs and/or alcohol and is found to be 50% or more at fault, how much can they recover? - ANSWER-$0.00 A commercial property coverage part includes: - ANSWER-Common policy conditions Commercial property declarations One or more causes of loss forms When an insurance adjuster advises an insured to misrepresent the claim by suggesting how to report a claim, the adjuster should be charged with: - ANSWER-Unfair Claims Act The "outside premises" policy insuring agreement covers: - ANSWER-Loss of money and securities and other property outside the premises. The insurer cannot prevent a public adjuster from meeting with their client after: - ANSWER-the insurer has been notified of the existence of a contract DP-1 is basic Dwelling Coverage. What is the only water damaged covered under this form? - ANSWER-Damage caused by water used to extinguish a fire In Florida, any policy that contains a separate hurricane deductible must include: - ANSWER-the actual dollar value, bold print and notice of high-out-of pocket expense to you Coverages included under a commercial packaged policy (CPP): - ANSWER-Farm Coverage Commercial Crime Coverage Commercial GL Commercial Property Commercial Auto Commercial Inland Marine Boiler and Machinery Professional Liability Employment Practices If an insured fails to comply with the immediate notice of claim requirements, what could happen? - ANSWER-The coverage could be denied What coverage of the garage policy will pay for physical damage to a garage customer's auto regardless of legal liability? - ANSWER-Garage Keepers Direct Coverage Endorsement The purpose of the Florida Citizens Property Insurance Corporation is: - ANSWER-to provide coverage on dwelling and homeowner risks that are unable to obtain coverage in the standard markets using standard property insurance forms. If a property is eligible, what endorsement can Flood coverage be purchased under the Commercial Property Policy? - ANSWER-CP 10 65 If flood coverage CP 10 65 exists along with NFIP, which coverage is considered excess? - ANSWER-CP 10 65 The promise by one party that is conditioned on an uncertain event and where the value given by each party is unequal is called: - ANSWER-Aleatory When does coinsurance not apply? - ANSWER-When the insured suffers a total loss to the property. In Florida, grounds for compulsory refusal, suspension, or revocation of an agent's or adjuster's license or appointment includes: - ANSWER-Material misstatement, misreprepresentation, or fraud in obtaining a license Using the license to willfully circumvent any of the requirements or prohibitions of Florida insurance laws Demonstration of a lack of fitness or trustworthiness to engage in business of insurance What forms the basic eligibility requirements for all of the residual markets in Florida? - ANSWER-The risk is unable to find a market for the required coverages. When a business owner declaration page contains more than one named insured, in case of cancellation, who receives the notice? - ANSWER-The first named insured What is insured under the valuable papers and records coverage form? - ANSWER-Books, maps and film Property of Others Mortgage & Manuscripts Someone, other than the insured, to whom the insured property is entrusted "temporarily" is known as a: - ANSWER-Bailee Name three claim settlement options: - ANSWER-Repair Replace with LKQ Replace with New When are non-residents subject to florida's insurance laws if a motor vehicle has been physically present in florida? - ANSWER-90 days during the preceding year When can an insured assign a policy to another policy? - ANSWER-Only with written consent from the insurer Name the exclusions under the DP-2 Dwelling form: - ANSWER-Flood, Earthquake, Mudslides. What is considered to be the most important implied warranty under a Ocean Marine Policy? - ANSWER-Seaworthiness of the Vessel Taking property by force or the threat of force is defined as: - ANSWER-Robbery Requirements that truckers be financially responsible for cargo they carry are imposed by: - ANSWER-State and Federal Government [Show Less]
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Florida 3-20 Public Adjusters State Exam (Set 1) Questions and Answers (Graded A)
The insurer and insured agree to a specific value of insured item - ANSWER-Agreed Value Policies Someone who has care, custody or control of another's p... [Show More] roperty - ANSWER-Bailee Claim filed by policy holder against his _ - ANSWER-First Party Claim When a person who entrusts another with an object and it results in injury to someone can be held liable for the injury to someone. Can be held liable for the injury i.e. Firearm or DWI - ANSWER-Negligent Entrustment Hazard that results from a conscious decision made by an insured to participate in a manner or behavior more likely to result in a loss because they have insurance - ANSWER-Moral Hazard Used to provide temporary insurance coverage until an insurance policy can be written - ANSWER-Binder Required by lenders to guarantee that outstanding loans against a job are paid upon completion - ANSWER-Completion Bonds The section of an insurance policy identifying the insured, endorsements, coverages, limits, and premiums - ANSWER-Declarations Policyholder cannot transfer the policy to someone else without written permission from their insurance company - ANSWER-Assignment An instance, behavior or environment that increases the likelihood of a loss on an insured item - ANSWER-Hazard Actual cause or source of an incidence of destruction, injury, or loss - ANSWER-Peril An insurance company organized and domiciled outside the US - ANSWER-Alien When there is an unbroken chain of events between an occurrence and a loss, then the loss is part of the original occurrence - ANSWER-Proximate Cause Is proximate cause of all subsequent damages - ANSWER-Original Occurance An individual who contracts with an adjusting firm as an independent contractor and handles claims for the insurance companies - ANSWER-Independent Adjuster Action or practice of the insured party is permitted to continue because any defense against a continuation of said action or practice has been waived by the insurer - ANSWER-Estoppel Operate for profit, collect premiums, reserve a portion of premiums to pay claims - ANSWER-Commercial Insurers Any person who investigates or adjusts losses on behalf of either an insurer or a self-insured - ANSWER-Independent Adjuster The result of an insured's tort or wrongdoing. Consequences of a loss or amount or type of losses suffered - ANSWER-Damages Requires the insured to insure the named property for a specific amount of insurance as required by the insurance company - ANSWER-Agreed Value Physical harm to tangible property caused by peril (loss to property or person in which a covered peril is the proximate cause of damage or destruction) - ANSWER-Direct loss The entity that is the "recipient" to the Principal - ANSWER-Obligee Insurance contracts are written on a take it or leave it basis to the policy owner. - ANSWER-Adhesion Event or circumstance that causes damage - ANSWER-Occurance Coverage provides for payment of losses if civil authority denies access to the insured premises due to a covered peril - ANSWER-Civil Authority Voluntary relinquishment of a known legal right - ANSWER-Waiver An insurer domiciled outside the state where it writes insurance - ANSWER-Foreign A state officer who administers the state's insurance laws and regulations - ANSWER-Commissioner Used as a promise to accept a bid if awarded to a company - ANSWER-Bid bond Damaged property an insurer takes over to reduce their loss after paying a claim - ANSWER-Salvage Factual statements upon which an insurance policy is based - ANSWER-Representations A contract between two parties that offer the consumer little to no leeway to negotiate the terms of the contract - ANSWER-Contract of adhesion Publication in any media by the insured about goods or services - ANSWER-Advertisements Also known as Absolute Liability, based on the theory of the duty of making something sage that is inherently dangerous - ANSWER-Strict Torts A house, structure, also referred to as a "primary risk" - ANSWER-Dwelling Condition enforced by the courts to do something bound under law or in a contract - ANSWER-Strict Torts Amount of loss paid by the policy holder - ANSWER-Deductible Violation of an agreement between a seller and buyer in reference to the condition, content, quality, or title of an item sold - ANSWER-Breach of Warranty Compensation, reparation - ANSWER-Indemnify Provides property coverage on a contractor's interest in equipment intended for permanent installation while it is being transported, unloaded, and installed - ANSWER-Installation Floater A beneficiary of a contract only as a result of the First Party's negligence - ANSWER-Third Party Reinsurance agreement where the insurers involved will pay claims in direct relationship with the % of the risk that they are insuring - ANSWER-Quota Share Sharing the cost of replacement - ANSWER-Risk Sharing A legal action filed by one or more persons on behalf of themselves and others having an identical interest in the alleged wrongdoing - ANSWER-Class-Action A specific risk or cause of loss covered by an insurance policy, such as fire, windstorm, flood, theft, etc. - ANSWER-Peril Dangers in a store, warehouse, or office; circumstances of risks and perils determine who is responsible for _____ - ANSWER-Premises Liability A loss or risk the policy doesn't cover - ANSWER-Exclusions Technique used to transfer the risk of a person, business, or organization in another through the use of a two-party contract - ANSWER-Insurance A legal two-party document describing the relationship between the insured and the insurance company - ANSWER-Indemnity Contract Legal document that makes some person responsible for damages their actions or products cause regardless of any fault on their part - ANSWER-Strict Liabilty The intention to withhold relative information about the risk from the insurance company - ANSWER-Concealment A subset of the claims function whereby suspicious losses are investigated separately from the normal claims adjusters' activities - ANSWER-Special Investigations Unit An insurer takes no action upon realizing material changes in a contract - ANSWER-Implied Waiver Acts committed without negligence but result in damages - ANSWER-Intentional Tort Willful and illegal sinking of a ship at sea or its cargo - ANSWER-barratry Covers physical damage as well as liability and tends to be very broad in coverage - ANSWER-Commercial Inland Marine Single insurance for only one kind of property at only one location of an insured - ANSWER-Specific Coverage Legislative Acts or Laws - ANSWER-Statutes The insurance company to which the risk is transferred to by the contract - ANSWER-Second Party Hazards on private property that might attract trespassing such as swimming pools or trampolines - ANSWER-Attractive Nuisance An approximate calculation of amount, extent, quality, magnitude, position, degree or worth of something - ANSWER-Estimages Insurance company assesses, mitigates, and monitors the items of risk that potential customers want to insure - ANSWER-Risk management Granting the privileges and licensing in a state based on having a license in another state that is deemed equivalent by the granting state - ANSWER-Reciprocity Specific protection in an insurance policy - ANSW [Show Less]
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Adjuster Pro - Insurance adjuster test Questions and Answers (Graded A)
What is insurance? - ANSWER-protection against financial loss what is a premium - ANSWER-a scheduled amount to be paid for an insurance policy. What ... [Show More] are premiums used for - ANSWER-premiums are collected into a "pool" or "reserve to pay out claimants when needed. how can insurance companies afford to pay for an individuals catastrophic loss? - ANSWER-the insurer collects premiums from all policy holders and uses them to pay out the claims of a few. what is Indemnity - ANSWER-payment for damages, that is not more or less than the amount caused by the damage. principle of idemnity - ANSWER-insurance will pay no more or less than the actual financial loss suffered indemnification may also include - ANSWER-repairs to property reimbursement for additional living expenses rental cars and hotels costs directly associated with a loss 4 Parts of Legal Contract - ANSWER-1. Agreement 2. Consideration 3. Competent Parties 4. Legal Purpose legal contract - agreement - ANSWER-mutual intent by offeror and offeree six special characteristics of insurance contracts - ANSWER-1. Personal 2. adhesion 3. utmost good faith 4. aleatory 5. unilateral 6. conditional what kind of contract is an insurance policy? - ANSWER-Personal contract what is a contract of adhesion - ANSWER-the insured must accept the entire contract with all of its terms and conditions Utmost Good Faith - ANSWER-An obligation to act in complete honesty and to disclose all relevant facts. Aleatory Contract - ANSWER-a contract where the values exchanged may not be equal but depend on an uncertain event Unilateral Contract - ANSWER-insurance agrees that they must pay in event of a claim. the insured can stop paying premiums at any point. only the insurer has promised to perform an action. Conditional Contract - ANSWER-A type of an agreement in which both parties must perform certain duties and follow rules of conduct to make the contract enforceable. Acronym for the four sections of an Insurance policy - ANSWER-DICE D - declarations page I - Insuring Agreement C- Conditions E - Exclusions Decelerations section - ANSWER-Always the first section - establishes the following Names of both parties Policy number Location and description of insured item Dates of the policy Amount and limit of coverage Deductible Premium Definitions section - ANSWER-Defines terms used to write policy including "collusion" "decay" "like kind and quality" Includes important language for adjusters to know Insuring agreement section - ANSWER-What is covered and how Which causes of loss are covered Any services provided Any exclusions to coverage The maximum limit of policy coverage in dollars Conditions section - ANSWER-Insurer specifies any limits or qualifications the policy holder must meet Exclusions section - ANSWER-losses for which the insured is not covered for Endorsements - ANSWER-Provision that modifies the coverage of the original contract Add or subtract coverage Synonyms - rider, addendum, attachment Certificate of Insurance - ANSWER-A legal document that indicates that an insurance policy has been issued, and that states both the amounts and types of insurance provided. Characteristics of social insurance - ANSWER-Non profit Mandatory participation Benefits prescribed by law Designed to meet needs of public Government has monopoly Private Insurers - ANSWER-Sell insurance based on needs and preferences Wide variety of products Exist to generate a profit Insured party voluntarily participate Stock Insurance Companies - ANSWER-Always for profit Publicly traded Stockholder provide capital and participate in profit or losses "Non participation" insurers - no dividends go to policy holders Mutual Insurance Company - ANSWER-No shareholders Policy holders elect board of directors "Participating" insurers - policy holders participate in dividends Re-insurer - ANSWER-Provides insurance for insurers to reduce exposure to loss Pays percentage of insurers loss or any loss over a certain amount Reciprocal Insurers - ANSWER-Unincorporated Non profit Operated by attorney in fact Members pay into individual accounts Cost of claims shared by whole groups Fraternal Benefit Societies - ANSWER-Also called fraternal associations Non profit mutual aid organizations Engage in charitable activities Provide some type of insurance to members Typically consist of people with similar religion, ethnicity or occupation Fraternal Benefit Societies insurance - ANSWER-Used to fund altruistic activities Must be assessable by law Members are both providers and recipients If claims payment ability is impaired, members help pay the difference captive insurers - ANSWER-Created by businesses in order to retain risk Exist to provide insurance for their "parent" All profit belongs to parent company Permitted in some states Risk retention groups - ANSWER-Authorized by the federal liability risk retention act of 1986 Owned by their members Provide commercial liability RRG Requirements - ANSWER-Members must be involved in similar business endeavors Don't need to be licensed in multiple states Classification based on location - ANSWER-Domestic Insurer - adhere to law of a state, located in that state Foreign insurer - adhere to laws in the US but can be located elsewhere Alien insurer - obey laws of another country all together Risk - ANSWER-Potential for financial loss An insured item Two types of risk - ANSWER-Pure and Speculative Speculative risk - ANSWER-No certainty of gain or loss Made knowingly, by conscious choice Cannot be insured Pure risk - ANSWER-Risk with no chance of gain Can only result in either loss or no loss Can be insured Exposure - ANSWER-Extent to which an item, person, or organization is open to damage or loss Evaluating exposure - ANSWER-Expressed in dollars or units Determining factor in issuing a policy and setting a premium Hazard - ANSWER-A condition increasing the likelihood or severity of a loss Peril - ANSWER-The actual cause of loss or damage Insurable risk - ANSWER-Adequate premiums Definable risk Unexpected losses Substantial loss Exclusions Law of large numbers Adequate Premiums - ANSWER-Potential loss can't be too much for insurer to pay Insurer must b able to cover claims and expenses If premiums must be set too high, the risk is not insurable Difneable risk - ANSWER-Insurer can define exact conditions under which the item is covered by the policy Item it's self is defineable Item has precise value Unexpected loss - ANSWER-Unforeseeable Unexpected Reasonably unpreventable Random in nature Substantial loss - ANSWER-Must cause substantial economic hardship Exclusions - ANSWER-Insurer must be able to exclude large scale disasters and catastrophic events Law of large numbers - ANSWER-Insurer must be able to cover large numbers of similar risks Spreads risk across more policies Helps insurers predict losses more accurately Similar risks can mean, cars houses, persons lives, similar business etc Adverse Selection - ANSWER-when someone buys health insurance because they know they will probably file a claim 4 risk management techniques - ANSWER-Avoidance Reduction Transference Retention Risk avoidance - ANSWER-Eliminates risk by not taking action that involves risk Risk reduction - ANSWER-Taking measures to reduce risk that is involved Also called risk mitigation Risk Transference - ANSWER-Management of sever risk by transferring risk to [Show Less]
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