Florida adjuster exam with verified questions and answers
What is Insurance? - CORRECT ANSWER - A financial tool that protects people from their
... [Show More] losses.
Transfers risk from one party to another:
1. Insured (people) purchases an insurance policy
2. Insurer provides financial protection to the insured
How does Insurance work? - CORRECT 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) - CORRECT 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 - CORRECT ANSWER - Restoration to previous financial condition; no more, no less.
Indemnification - CORRECT ANSWER - Being restored to the financial condition you were in before a loss
Insurance Policy (ACCL) - CORRECT 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) - CORRECT 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 - CORRECT ANSWER - Individual or organization that pays premiums in exchange for protection
Insurer - CORRECT ANSWER - Company, group, or government agency offering financial protection
Risk (meaning) - CORRECT 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) - CORRECT ANSWER - The insured person is protected from losses; not the covered property
D.I.C.E. - CORRECT ANSWER - 1. Declarations Page (aka "Dec Page")/Definitions Section
2. Insuring Agreement
3. Conditions
4. Exclusions/Endorsements
Declarations Page ("Dec Page") - CORRECT 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 - CORRECT 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 - CORRECT 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 [Show Less]