Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified a, Exams of Nursing

Download Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified a and more Exams Nursing in PDF only on Docsity! Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Accident Insurance - CORRECT ANSWERS Covers expenses associated with a covered accident and can extend to ambulance and emergency room expenses, intensive care, and hospital costs. Accident insurance also provides for loss of income, and a death benefit if injuries prove fatal Accumulated Depreciation - CORRECT ANSWERS The total decrease in an item's value over a period of time. Formula: (annual depreciation x number of years used). Subtract this number from the item's replacement cost to get its actual cash value (ACV). Acreage Reporting Date - CORRECT ANSWERS In crop insurance, the deadline for providing the insurer with an acreage report, which is used to determine the amount of coverage needed and the premium charged for a particular crop. Actual Cash Value (ACV) - CORRECT ANSWERS 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) Actual Production History - CORRECT ANSWERS A history of a farmer's crop yields over a multi-year period, which is used to determine the normal production level of a farm. Adhesion - CORRECT ANSWERS Characteristic of an insurance contract. Means that one party (the insurer) sets the terms, and the other (the policyholder) can "take it or leave it. Adjusted Gross Revenue (Crop Insurance) - CORRECT ANSWERS Narrowest (and least expensive) form of crop revenue insurance. Insures farm revenue as a whole Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ instead of individual crops. Guarantees a percentage of the insured farm's average revenue. Adjuster - CORRECT ANSWERS An agent who, for compensation, processes insurance claims. The adjuster investigates the damages, evaluates the claim, and makes a fair and equitable settlement based on the insurance contract. Can represent either the insured or the insurer. Adjuster - Emergency - CORRECT ANSWERS 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 - CORRECT ANSWERS 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 - CORRECT ANSWERS 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 - CORRECT ANSWERS Salaried employee of one insurance company who can work locally, regionally, or nationally. Also called: Company Adjuster Advance Payment Settlement - CORRECT ANSWERS 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 Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ two appraisers in turn select an umpire. The appraisers then work together to determine a settlement amount. If they cannot agree, the umpire steps in. Agreement by any two of the three is binding. Arbitration - CORRECT ANSWERS A dispute resolution method in which the opposing parties each submit their evidence to a mutuallyagreed- upon and neutral third party, called an arbitrator. The arbitrator reviews the positions of each opposing side and makes a final and legally binding decision. Arbitrator - CORRECT ANSWERS The mutually-agreed-upon and neutral third party in an arbitration who reviews the positions of each opposing side before making a final and legally binding decision. Artificially Generated Current - CORRECT ANSWERS Also called "artificial current." A peril covered in some property insurance policies. It includes sudden and accidental damage from any electrical current, except currents that are naturally generated, such as lightning or static electricity. Auto Policy - CORRECT ANSWERS Insurance policy designed to protect the policyholder while owning, occupying, or operating a vehicle. Usually combines liability coverage and property coverage into one policy. Automobile - CORRECT ANSWERS In insurance policies, automobile generally means any vehicle designed for use on public roads. Automobile No-Fault Laws - CORRECT ANSWERS Laws in effect in some states that require any owner of a vehicle to purchase no-fault insurance; that is, Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ insurance that indemnifies the insured, regardless of who was at fault in an accident. No-fault laws also restrict the insured's right to sue the at-fault party. Aviation - CORRECT ANSWERS Aviation insurance combines hull insurance for the aircraft and liability insurance for any damage to others' property or to people who are not passengers. Average Weekly Wage (AWW) - CORRECT ANSWERS The average amount of income that an employee earns each week while able to perform normal job duties. When an employee is injured on the job, his workers' compensation income benefits will depend on his AWW before the injury. Bailee - CORRECT ANSWERS An individual or company that receives the property of someone else for a special purpose and returns the property after use. Bailee Coverage - CORRECT ANSWERS Reimburses a bailee's customer for damage to the customer's property while in the bailee's control Binder - CORRECT ANSWERS A temporary contract provided by an insurer, which ensures coverage until the complete, permanent policy is issued Black Lung Benefits Act - CORRECT ANSWERS Federal program that provides monthly payments and medical treatments to coal miners who become totally disabled from black lung disease or pneumoconiosis Bodily Injury (BI) - CORRECT ANSWERS Physical damage to someone's person. Liability insurance covers bodily injury that the insured might Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ cause to another person through negligence. Boiler & Machinery - CORRECT ANSWERS Insurance coverage 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 - CORRECT ANSWERS 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 - CORRECT ANSWERS The failure or falsehood of a stated promise of a product stipulation Business Auto Policy (BAP) - CORRECT ANSWERS Provides property damage and liability insurance for automobiles used by a business Business Floater - CORRECT ANSWERS Inland marine coverage form designed for items that are excluded from most property contracts, such as accounts receivable records, manuscripts, blueprints, etc. Business Interruption Coverage - CORRECT ANSWERS Commercial insurance form designed to indemnify a business if a covered peril leads to lost profits or revenue. The most common type of Time Element Insurance. Business Personal Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Coercion - CORRECT ANSWERS The practice of forcing another party to behave in an involuntary manner (whether through action or inaction) by use of threats, intimidation, or some other form of pressure or force. Coinsurance - CORRECT ANSWERS A property insurance provision that requires the policyholder to carry adequate coverage (typically at least 80% of the property's value). If a property does not meet this requirement (i.e. if it is underinsured), the insurer applies a penalty on claims for partial losses. The penalty requires the policyholder to pay a percentage of the claim, depending on how underinsured the property is. To calculate: divide the actual coverage by the coinsurance requirement and then multiply that by the loss. In health insurance, coinsurance refers to the portion of a covered claim that the insured is responsible for paying out-ofpocket, after the deductible has been paid. Coinsurance Payment (Health Insurance) - CORRECT ANSWERS A percentage of the total health care expenses that the insured must pay. Commerce - CORRECT ANSWERS The exchange or transport of goods or property Commercial - CORRECT ANSWERS Having to do with commerce or business activity in general Commercial Crime Insurance - CORRECT ANSWERS Commercial insurance that covers employee dishonesty and theft by employees or others. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Commercial Lines - CORRECT ANSWERS A variety of insurance coverages that protect those involved in the business of creating, selling, displaying, evaluating, or shipping, etc. Examples include: business owner's policy (BOP); commercial property; commercial general liability (CGL); workers' compensation (WC); professional liability, errors and omissions (E&O); and employment-related practices liability. Commercial Property Floater - CORRECT ANSWERS A means of protecting a business' property that is not in one fixed location. Includes domestic shipments, instrumentalities of transportation and communication, and commercial property floater risks. Common Crop Insurance Policy - CORRECT ANSWERS A single uniform policy that combines crop revenue coverage, revenue assurance, income protection, and indexed income protection Common Law - CORRECT ANSWERS Based on court decisions and customs when statutory law does not provide an answer; creates precedent. Compensatory Damages - CORRECT ANSWERS Money awarded in civil court for tangible and intangible damages caused by a policyholder. There are two types: general and special Compensatory Damages - General - CORRECT ANSWERS Money awarded for the emotional losses of the plaintiff that will continue after the trial date. These are a subjective value and are determined by the court. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Compensatory Damages - Special - CORRECT ANSWERS Money awarded for the exact value of the physical damage caused to the plaintiff up to the trial date. This is an objective value determined by receipts and medical bills Competence - CORRECT ANSWERS One of the four qualifications of a legally binding contract. All parties must be competent, with the necessary legal and mental capacity. Complaint - CORRECT ANSWERS A complaint initiates a civil lawsuit by one person (the plaintiff) requesting financial relief from damages caused by someone else (the defendant). Concealment - CORRECT ANSWERS The act of withholding relevant material facts from an insurer Conditionally Renewable Policy - CORRECT ANSWERS A policy that gives the insurer the option to cancel coverage only if certain stated conditions are met. Conditions - CORRECT ANSWERS The section of a policy that qualifies or limits an insurer's promise to pay or perform. Consideration - CORRECT ANSWERS One of the four qualifications of a legally binding contract. All parties must bring something of value to the contract. Contract - CORRECT ANSWERS An agreement entered into voluntarily by two parties or more with the intention of creating a legal obligation. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Declined Coverage - CORRECT ANSWERS Takes place when an insurance company rejects an application for coverage Deductible - CORRECT ANSWERS The amount the policyholder must pay out- of-pocket before the insurance company will pay the remaining costs. There are three types: fixed, franchise, and percentage Deductible - Fixed - CORRECT ANSWERS One specific, predetermined amount that a policyholder must pay out-of-pocket before his policy coverage kicks in Deductible - Franchise - CORRECT ANSWERS The policyholder only pays if the total damages come out to less than his deductible. If the cost of damages equals or exceeds the deductible, the insurer pays the full amount and the policyholder pays nothing Deductible - Percentage - CORRECT ANSWERS A deductible that is calculated as a percentage of the value of the insured risk Defamation - CORRECT ANSWERS Damage to another's name or reputation, whether by libel (which is in print) or by slander (which is in speech). Default Judgement - CORRECT ANSWERS A judgment entered by the court against a party who fails to present his case or defense in a civil action. Most commonly, this applies when the defendant fails to show up and answer the claim brought against him, so the court decides in favor of the plaintiff. Definitions - CORRECT ANSWERS Page in policy that gives specific limited meaning to terms used in policy Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Depreciation - CORRECT ANSWERS A decline in value of property caused by wear or loss of usefulness, usually measured by a specific formula. Diligence and Dispatch - CORRECT ANSWERS An adjuster should act with speed and care in completing the adjusting process. Failure to settle a claim in a timely manner can result in disciplinary action by the insurance commissioner, including a fine or loss of license Disclosure - CORRECT ANSWERS An adjuster must disclose all financial interests in any direct or indirect aspect of an adjusting transaction. For example, an adjuster cannot refer a claimant to his brother's auto repair business without first telling the claimant that the business is owned by a relative Discoverable - CORRECT ANSWERS Capable of being demanded and handed over as evidence in a court of law; during litigation proceedings, the adjuster's claims file is discoverable DP-1 - CORRECT ANSWERS "Basic Form" of Dwelling Policy. Covers direct physical loss to property caused by only three perils: fire, lightning, and internal explosion (coverage for other perils can be added by endorsement). DP-2 - CORRECT ANSWERS "Broad Form" of Dwelling Policy. A named peril policy that covers everything on the DP-1 Basic from, as well as 9 Extended Form perils and the Broad Form perils. DP-3 - CORRECT ANSWERS "Special Form" of Dwelling Policy. Unlike DP-1 and DP-2, DP-3 offers open-peril coverage for the Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ property's structures (but named peril for personal property). Dwelling Policy (DP) - CORRECT ANSWERS Property coverage for people and businesses who are not eligible for homeowners insurance or do not need the extensive coverage of the homeowners policies. Electronic Data Processing (EDP) - CORRECT ANSWERS An endorsement that covers the loss of computer equipment, data systems, information storage media, and expenses or lost income related to EDP losses. Eligibility - CORRECT ANSWERS Eligibility Requirements are found in some insurance policies. They identify the conditions that must be met by the policyholder in order to qualify for coverage under a policy. End of Insurance Date - CORRECT ANSWERS The date that crop insurance coverage will end. It is the earliest of the following: total crop destruction, harvest of the crop, final adjustment of a loss, abandonment of a crop, or a date predesignated by crop type. Endorsement(s) - CORRECT ANSWERS An optional provision that can be added to a policy to increase, reduce, or modify coverage for specific property types or perils Errors and Omissions (E&O) - CORRECT ANSWERS Liability insurance that indemnifies professionals for errors or oversights on the part of the insured that caused harm to their clients Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Federal Crop Insurance Corporation (FCIC) - CORRECT ANSWERS A government-owned corporation that manages the federal crop insurance program. Federal Emergency Management Agency (FEMA) - CORRECT ANSWERS A branch of homeland security that coordinates relief programs when disaster strikes an entire community. Federal Employees Compensation Act (FECA) - CORRECT ANSWERS Federal program that provides insurance for civilian employees of the federal government. As a workers' compensation program, FECA covers disability or death sustained while the employee is on the job. Pays medical expenses and two-thirds of normal monthly salary while the employee is unable to work. Additional payments may be made for permanent injuries or to dependents. Federal Employers Liability Act (FELA) - CORRECT ANSWERS Federal program enacted in 1908 before most state workers' compensation laws. FELA protects only interstate railroad workers and their families, by allowing workers who are not covered by regular WC laws to sue their employer Fiduciary - CORRECT ANSWERS One of the terms that describes the adjuster's relationship with the principal (the insurer). As fiduciary agent, the adjuster acts for the benefit of the principal, rather than for his own benefit. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Fiduciary Duty - CORRECT ANSWERS A legal relationship in which one party represents the best interests of another. As the insurer's fiduciary agent, the adjuster makes financial decisions on behalf of the insurer and must uphold the insurer's financial interests in all transactions,while ensuring that claims are settled fairly according to their insurance contracts. This means the adjuster must perform her job with honesty and "utmost good faith" at all times. Final Planting Date - CORRECT ANSWERS In crop insurance, the last day to plant crops in order to receive the full insurance yield and/or revenue guarantee selected. First Named Insured - CORRECT ANSWERS The first person or entity named as insured on the declarations page of a policy First Party Claim - CORRECT ANSWERS A claim that a policyholder files with her own insurer (as opposed to a third party claim, which the claimant files with someone else's insurer). Floater - CORRECT ANSWERS A term for inland marine policies that cover mobile property. See also: "Controlled Lines Floater" and "Uncontrolled Lines Floater." Flood - CORRECT ANSWERS An overflow of inland or tidal waters; an unusual or rapid accumulation of runoff or surface waters from any source; mud flows; collapse or subsidence of land along the shore of a lake or other body of water. Flood Insurance - CORRECT ANSWERS Provides relief following flood damage to communities who participate in the NFIP floodplain management Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ system; covers damages to the building and its contents Floodplain Management - CORRECT ANSWERS Maps out areas with high risk of flood, so that communities will avoid building in these areas Fraternal Benefit Societies - CORRECT ANSWERS Non-profit, mutual aid organizations that engage primarily in charitable or benevolent activities. They offer their members insurance against death, disease, and disability. Also known as Fraternal Associations Fraud - Hard - CORRECT ANSWERS Deliberately faking or causing an incident in order to collect money Fraud - Soft - CORRECT ANSWERS Inflating the gravity or the extent of claims in order to receive a higher indemnification. Free on Board (FOB) Destination Point - CORRECT ANSWERS A term used in Ocean Marine insurance. It means that the title to the property being shipped remains with the shipper until it arrives at the buyer's destination and the buyer accepts the property Free on Board (FOB) Shipping Point - CORRECT ANSWERS A term used in Ocean Marine insurance. It means that the title to the property being shipped transfers to the buyer as soon as the property leaves the shipping dock. Full Release Settlement - CORRECT ANSWERS A settlement option whereby the insurer pays all damages at once in an immediate "lump sum" and the claimant signs a "full release form" which releases the insurer from any further liability. This is the most common settlement option. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ contents. H0-4 - CORRECT ANSWERS "Contents broad form"; named-peril renter's policy covering only personal property and any structural improvements made at the tenant's own expense. H0-5 - CORRECT ANSWERS "Comprehensive form" of homeowners insurance; provides all-peril coverage for both structures and contents. H0-6 - CORRECT ANSWERS "Condo" or "unit owner's form"; named-peril homeowners policy covering personal property and the surface structure of a condominium. H0-8 - CORRECT ANSWERS "Modified coverage form" of homeowners insurance; named-peril coverage for structures and contents, fewer perils covered. Homeowners Policy - CORRECT ANSWERS An insurance policy that combines property coverage with liability coverage for a person's home. Hospital Expense Insuranc - CORRECT ANSWERS Provides coverage for a variety of hospital expenses, including room and board, medical expenses, lab fees, and nursing care. Hospital Indemnity Insurance - CORRECT ANSWERS A supplemental coverage that provides a flat amount of indemnification per day for hospitalization Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Impaired Property - CORRECT ANSWERS Property that is defective because the insured's deficient or incomplete additions or work Income Protection (Crop Insurance - CORRECT ANSWERS A form of crop revenue insurance. Relatively inexpensive, it provides a fixed revenue guarantee based on early commodity prices for the crop type. Indemnification - CORRECT ANSWERS Reimbursement for a loss, which leaves the claimant in the same financial position that she was in before the loss. Indemnify - CORRECT ANSWERS To restore by payment, repair, or replacement Indemnity Insurance - CORRECT ANSWERS Insurance that indemnifies loss as opposed to liability Inducements - CORRECT ANSWERS Actions, items, or promises made to someone in order to motivate them to act in a certain way. Examples of inducements include kickbacks, gifts and bribes. Inherent Vice - CORRECT ANSWERS A characteristic in a thing itself that causes gradual deterioration or self-destruction. Losses or damage related to inherent vice are not insurable Inland Marine Insurance - CORRECT ANSWERS Insurance that covers property being transported over land, or property that is involved in the transportation of goods Instrumentalities of Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Transportation and Communication - CORRECT ANSWERS A term used in Inland Marine insurance that refers to property directly related to transportation and communication, including bridges, tunnels, roads, dams, piers and docks, oil pipelines, power transmission lines, and radio and TV towers Insurable acreage - CORRECT ANSWERS All of the acreage of the insured crop, for which a premium rate is provided in the actuarial documents, in which the insured has a financial interest, and which is planted in the county listed on the application Insurance - CORRECT ANSWERS A financial device that transfers the risk of unexpected, catastrophic losses from one party to another. Insurance Commissioner - CORRECT ANSWERS Most states have an insurance commissioner who is responsible for regulating many aspects of the insurance industry (especially those concerning the financial solvency of the insurers doing business in the state). The commissioner oversees the financial stability of insurers and regulates the rates that insurers charge Insurance Company - CORRECT ANSWERS Company which sells insurance policies to individuals or to other companies. Insurance Fraud - CORRECT ANSWERS Using insurance to obtain money unlawfully. This can be done by a policyholder, or by an insurer or an insurer's employees. There are two kinds of insurance fraud: soft fraud and hard fraud Insurance Information and Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ common endorsement in both residential and commercial policy packages. Also known as Code Upgrade Coverage. Leased Worker - CORRECT ANSWERS Worker hired through a labor leasing firm. Legal Purpose - CORRECT ANSWERS One of the four qualifications of a legally binding contract. The purpose of the contract must be legal (e.g. no contracts for illicit drug deals). Liability - CORRECT ANSWERS An obligation to do or not to do something; responsibility for an action. Liability Insurance - CORRECT ANSWERS Liability insurance indemnifies a third party for damages caused by the insured's negligence Liability - Employer - CORRECT ANSWERS Protects employers from claims not covered by workers' compensation for damages and bodily injury caused to employees while performing under the scope of their employment. Liability - Product - CORRECT ANSWERS Protects a policyholder from legal liability for damages to third parties caused by the manufacturing, merchandising, distributing, or operation of a product Liability - Professional - CORRECT ANSWERS Professional Liability Coverage protects professionals such as doctors, lawyers, engineers, architects, etc. It includes two types of coverage: malpractice insurance and errors and omissions insurance Liability - Public - CORRECT ANSWERS Protects individuals and commercial venues from any property damage or personal injury they may cause Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ to the general public Libel - CORRECT ANSWERS Damage to another's name or reputation in print. See also: "Defamation." Liberalization - CORRECT ANSWERS The liberalization clause in an insurance contract is a condition that states that the insurer can add or broaden coverage at any time without writing up a new contract. This clause guarantees that, in the case of legislative action that broadens insurance coverage without any increase in premiums, this additional coverage must take effect in existing policies as well as in new policies. License - CORRECT ANSWERS A document that shows that a person has been granted authority by the state to act as an insurance agent, broker, or adjuster Limit - CORRECT ANSWERS The limits of an insurance policy represent the highest amount an insurer will pay. Any cost above the limits of insurance is the responsibility of the policyholder. Limit - Aggregate - CORRECT ANSWERS The total amount the insurer will pay for all losses during the policy period. Often appears preceded by an occurrence limit (e.g. 100,000/1,000,000). The first number indicates the maximum payout for covered losses in any single occurrence, and the second number indicates the total amount the insurer will pay for all covered occurrences during the policy term Limit - Single - CORRECT ANSWERS Establishes 1 maximum limit for liability damages caused by the policyholder. Contrast with split limits Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Limit - Split - CORRECT ANSWERS An insurance provision that specifies different coverage limits for different parts of a claim. The most common example is split limits in a personal auto policy, which includes 3 different limits of liability: (1) maximum limit for bodily injury for any one individual, (2) maximum limit for bodily injury to multiple people in any one accident or occurrence, and (3) maximum limit for property damage in any one accident or occurrence. Litigation - CORRECT ANSWERS An action brought in court. Litigation takes place when an insurer and a policyholder disagree about a settlement amount and cannot resolve their differences through any sort of negotiation. Livestock Floater - CORRECT ANSWERS Optional farm insurance coverage. Provides stand-alone protection for six kinds of domesticated animals on a scheduled or unscheduled basis. Includes coverage for animals while in transit. Longshore and Harbor Workers' Compensation Act - CORRECT ANSWERS Federal program that provides compensation and medical care to employees who are injured while on the job on navigable waters of the United States. Loss - CORRECT ANSWERS Bodily injury, property damage, or damage caused by the insured's negligent acts; loss is the the basis for an insurance claim. Loss can also mean the sum the insurer will have to pay. Loss - Direct - CORRECT ANSWERS Physical harm to tangible property caused by a peril. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ have no shareholders and are not traded publicly. Named Peril Policy - CORRECT ANSWERS A policy that names all perils that will be covered. Contrast with open-peril policies National Association of Insurance Commissioners (NAIC) - CORRECT ANSWERS A non-profit coalition of state insurance agencies that works to protect consumers and harmonize state laws and regulations National Association of State Departments of Agricultural Research Foundation - CORRECT ANSWERS A non-profit association of public officials representing the Commissioners, Secretaries, and Directors of Agriculture in the fifty states and four territories National Center for Agricultural Law Research and Information - CORRECT ANSWERS Independent agricultural and food law research and information center created to address the complex legal issues affecting American agriculture National Crop Insurance Services (NCIS - CORRECT ANSWERS A non-profit international organization specializing in statistical data analysis and reporting related to crop insurance risk management. National Flood Insurance Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Program (NFIP) - CORRECT ANSWERS A program that provides insurance for communities that suffer flood damage and are willing to participate in the FEMA's floodplain management system. National Resources Conservation Service - CORRECT ANSWERS A federal agency within the USDA that works with private landowners and operators to help them protect their natural resources Negligence - CORRECT ANSWERS The failure to exercise a reasonable degree of care in a particular situation. Negotiations - CORRECT ANSWERS Negotiations take place when the insurer and the claimant do not agree about an indemnification amount. The insurance adjuster is often the one who will carry out the negotiations Non-Commercial - CORRECT ANSWERS Non-Commercial insurers are not-for- profit insurance companies that return profits to policyholders by reducing premiums or expanding benefits Nonconcurrency - CORRECT ANSWERS The situation in which 2 or more policies covering the same risk have different inception and expiration dates. Since the policies operate on different calendars, losses on the base policy may not count toward the limit which triggers the excess policy's coverage. Non-Waiver Agreement - CORRECT ANSWERS An agreement that the insurer asks the claimant to sign which states that the insurer's investigation of the loss can't be used later on as proof that the loss is covered under the policy. No Release Settlement - CORRECT ANSWERS A settlement option whereby the insurer simply pays the bills submitted by the claimant, but the claimant Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ does not sign a release form to verify the payment. Usually, the checks issued to indemnify the claimant act as a substitute for a release form. Also known as "Walk-away" Settlement Obligee - CORRECT ANSWERS The party in a "surety bond" that wants a guarantee that the principal will perform as promised, and is the recipient of the contractual obligation. See also: "Principal" and "Surety (Guarantor)." Occurrence - CORRECT ANSWERS An unexpected event or circumstance that causes injury or damage Occurrence Form Policy - CORRECT ANSWERS A liability policy in which the insurer covers losses that occur during the policy period, no matter when the claim is filed. The opposite of a claims-made form. Ocean Marine - CORRECT ANSWERS Insurance designed to protect property being transported overseas Open Peril - CORRECT ANSWERS An open perils policy covers all causes of loss except for those explicitly excluded. Also known as "All Peril." Optionally Renewable Policy - CORRECT ANSWERS The insurer retains the option to continue coverage for the insured upon expiration of the current policy period. The insurer may renew coverage or cancel coverage for any reason. Out-of-pocket Expenses - CORRECT ANSWERS Usually refers to any deductibles, coinsurance, or copayments that the policyholder pays as part of a health insurance program Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Power to Bind - CORRECT ANSWERS One manifestation of the authority given to insurance agents by the principal. The principal is bound by, or must adhere to, the guarantees and statements made by its agent Preferred Provider Organization (PPO) - CORRECT ANSWERS Like an HMO, this group insurance plan provides insurance by contracting a network of physicians, hospitals and medical care providers. Differs from an HMO in that members have more freedom to go outside of the network to choose their own physician Premium - CORRECT ANSWERS A scheduled and affordable fee, paid by the policyholder to the insurer, in return for coverage. Preponderance of Evidence - CORRECT ANSWERS A preponderance of evidence is enough evidence to make it more likely that an argument is true than that it is false. In a civil trial, the plaintiff needs to provide a preponderance of evidence in order to win her case. Primary Insurance - CORRECT ANSWERS Primary insurance pays first, before other policies that apply to the same loss. See also: "Excess Insurance." Principal - CORRECT ANSWERS The principal refers to an agent's employer (usually an insurance company, but it could also mean anyone who contracts the agent to work on their behalf and gives her the authority to do so). In a surety bond or suretyship, the principal (obligor) is the party that first agrees to fulfill an obligation, and is the one who purchases the bond. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Principle of Indemnity - CORRECT ANSWERS The principle behind all insurance contracts. It states that, when a loss occurs, the insured should be restored to his or her financial condition before the loss occurred, no better, no worse. The insured cannot profit from a loss Privacy - CORRECT ANSWERS In insurance, the right of consumers to have their personal information protected. Private Insurance - CORRECT ANSWERS Private insurance is the term for any insurance other than social insurance. Social insurance programs are run by the government instead of by private individuals Private Crop Insurance - CORRECT ANSWERS Crop insurance that does not fall under the Federal Crop Insurance Program and is provided directly to farmers by private insurers Proof of Loss - CORRECT ANSWERS The form or statement that the policyholder is required to submit to the insurer before she can be indemnified for a loss Property Damage (PD) - CORRECT ANSWERS Damage or loss of use of personal property. Pro Rata Apportionment - CORRECT ANSWERS When a loss is covered by more than one policy, the policies split the loss, based on the percentage of coverage each policy provided. For example, if a couple has 2 dwelling policies, one for $100,000 and the other for $50,000, and a loss occurs, the first policy will pay 2/3 of the loss, and the other policy will pay 1/3. Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Proximate Cause - CORRECT ANSWERS The original occurrence, the source, of all the subsequent damages Punitive Damages - CORRECT ANSWERS Intangible damages awarded to the plaintiff when the defendant's actions show intentional heinous, antisocial behavior or extreme indifference to harm. These damages are determined by the court and the adjuster cannot negotiate them. Rating System - CORRECT ANSWERS A risk management technique by which insurers identify hazards, assign risks to different classes, and set premiums accordingly. There are also rating systems whereby agencies rate different insurers' financial well-being, to educate the public and try to prevent insurer insolvency. Rebate - CORRECT ANSWERS Refunding part of a premium, due to the creation of a new contract or change to an existing contract Reciprocal Insurer - CORRECT ANSWERS An unincorporated organization of subscribers that operates through an attorney-in-fact to provide insurance benefits for its members. Reinsurers - CORRECT ANSWERS Companies which sell insurance to insurers to reduce the insurer's exposure to loss. Replacement Cost (RC) - CORRECT ANSWERS A method of valuation based on the cost of replacing an item at current market prices, regardless of depreciation Reporting - CORRECT ANSWERS One of the adjuster's duties is to report to the principal. The adjuster must give the principal frequent Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Risk Retention Group (RRG) - CORRECT ANSWERS A group in which the members insure each other, using their own capital to write insurance policies Sales Closing Date - CORRECT ANSWERS The last date on which an insurance application for a particular crop can be completed and signed Salvage - CORRECT ANSWERS Salvage is damaged property that has cash value. In homeowners insurance, the policyholder has the option of keeping the salvage and accepting a smaller settlement from the insurer. The insurer has the option of keeping the salvage if they have fully indemnified the insured. Scheduled Payment Release - CORRECT ANSWERS Sometimes called "open-ended release" or "rehabilitation settlement." The insurer agrees to pay all of the special damages and general damages that have accumulated so far, and agrees to pay special damages in the future. Settlement - CORRECT ANSWERS A resolution of a dispute, or an agreement. Settlement allows an insurer and a claimant to resolve a case before it reaches a court of law. Settlement Padding - CORRECT ANSWERS Increasing the settlement amount dishonestly in order to increase one's commission. This is unethical and criminal behavior Severability of Interests - CORRECT ANSWERS An insurance provision that states that coverage applies to each insured separately, as if no other insured Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ existed. Each individual insured is protected as a separate entity, even against other insureds (if one insured were to file a claim against another insured), but the limits of the policy still apply to all insureds collectively. Also known as "Separation of Insureds." Slander - CORRECT ANSWERS Damage to another's name or reputation in speech. See also: "Defamation." Small Grains - CORRECT ANSWERS In crop insurance, a provision that covers reduction in crop quality, as well as crop-yield losses. Small grains are wheat, barley, and oats. See also: "Coarse Grains" Standard Fire Policy - CORRECT ANSWERS The basic foundation for all homeowners and commercial property policies issued today. Developed in 1918 to provide insurance protection for both homeowners and commercial property owners, it was typically a named peril policy, but it only protected against losses from fire and lightning on an Actual Cash Value basis Stated Value - CORRECT ANSWERS A valuation method in which the insured simply assigns the risk a value at the outset of the policy. The insurer will pay this amount in case of a total covered loss Statute of Limitations - CORRECT ANSWERS A statute based on the common law legal system that specifies the maximum period of time, after damages occur, that legal proceedings based on those damages may be initiated. Statutory Law - CORRECT ANSWERS Based on laws set forth by a governing authority; i.e. state legislature Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Stipulation - CORRECT ANSWERS A stipulation is something specifically agreed to in a contract, such as an insurance contract. Stock Insurance Company - CORRECT ANSWERS A Stock Insurance Company is owned by stockholders, as opposed to its own policyholders (as is the case with Mutual Insurance Companies). Strict Liability - CORRECT ANSWERS Holds a party 100% liable for damages when the activity or instrument they are performing is inherently dangerous. Structured Settlement - CORRECT ANSWERS A settlement option whereby the insurer indemnifies the claimant in a series of smaller payments over a set period of time, instead of paying all at once. Typically reserved for claims involving a very large settlement amount, and the insurer often has to pay some of the amount in a lump sum up front. Subrogation - CORRECT ANSWERS The transfer of rights that occurs when an insurer indemnifies a claimant for a loss. The claimant transfers to the insurer his right to collect the amount of the indemnity from the guilty party. Sudden and Accidental Tearing Apart - CORRECT ANSWERS A peril covered in some property insurance policies. It refers to damage caused by rupture, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fire sprinkler system, or an appliance for heating water. Unlike accidental discharge, this peril includes coverage for the system or appliance itself Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ while in transit. This can include travel by truck, train, ship, mail, or plane Trigger - CORRECT ANSWERS An event that "triggers" the coverage provided under a Commercial general liability (CGL) policy: in claims-made, it is a claim, in occurrence form, it is the "occurrence." Trip Transit - CORRECT ANSWERS An uncontrolled Inland Marine coverage form which insures a single shipment. Coverage applies from the trip origination point to its destination. Trustworthiness - CORRECT ANSWERS The virtue of carrying out responsibilities reliably, worthy of being trusted. A necessary attribute of insurance adjusters Umbrella Liability Policy - CORRECT ANSWERS An umbrella policy provides liability coverage over and above the normal or base limits of liability in a policy. An umbrella policy is a type of Excess Liability. Uncontrolled Line Floaters - CORRECT ANSWERS As opposed to controlled line floaters, which are standard forms, uncontrolled line floaters are nonstandard forms tailored to meet the needs of the insured. They are not filed with state departments of insurance. They cover movable property and are typically used in Inland Marine insurance. Underinsured - CORRECT ANSWERS Not sufficiently insured against particular losses. For example, any home insured at less than 80% of its value is considered underinsured. Unfair Claim Settlement Practices - CORRECT ANSWERS Dishonest or unfair behavior related to settling insurance claims which is specifically proscribed by state Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ law. Unilateral - CORRECT ANSWERS A characteristic of insurance contracts. It means that only one of the parties (the insurer) makes a promise to perform. The insurer is obligated to fulfill this promise, whereas the insured is free to void the contract at any time Uninsurable - CORRECT ANSWERS Risks are said to be uninsurable when they do not meet certain qualifications. For example, an insurable risk cannot involve a loss that the insured deliberately causes. Certain perils are too catastrophic to be insurable (like war or nuclear events). Unscheduled - CORRECT ANSWERS Unscheduled property is property covered under an insurance contract that is not listed item by item (as "Scheduled" property would be listed). U.S. Environmental Protection Agency - CORRECT ANSWERS Federal agency primarily responsible for the implementation of most federal laws designed to protect, enhance, and conserve the nation's natural resources. Utmost Good Faith - CORRECT ANSWERS A characteristic of insurance contracts: 'utmost' meaning the 'highest degree' and 'good faith' meaning, "act with honesty, fair dealing and full disclosure." All parties to an insurance contract must act with utmost good faith. It also applies to a fiduciary agent's responsibility towards the principal. Valuable Papers Business Alabama Adjusters License Test Exam with 362questions and answers 100%Correctly verified answers latest update 2024/2025 RATED A+ Coverage - CORRECT ANSWERS Provides indemnification when a business experiences a loss of vital business records Valuation - CORRECT ANSWERS The process of estimating what an item is worth. Methods of valuation include "Actual Cash Value," "Replacement Cost," "Stated Value," and "Agreed Value." Value - CORRECT ANSWERS The estimated or appraised worth of an item, used to determine the replacement cost or indemnification amount. Valued policy - CORRECT ANSWERS A policy in which the insurer and the insured agree to a specific value prior to the start of the policy. If the item is lost or destroyed, the insurer pays the amount agreed upon Vicarious Liability - CORRECT ANSWERS When an act of negligence is transferred from one party to another, such as from employee to employer or from child to parent Waiver - CORRECT ANSWERS A waiver is a voluntary act of relinquishing a known right, claim or privilege. Either an insured or an insurer may waive rights. There are two types: express and implied. Waiver - Express - CORRECT ANSWERS An explicit relinquishment of a right. Waiver - Implied - CORRECT ANSWERS An implicit relinquishment of a right through behavior that seems to assume that the right does not exist Waiver of Sovereign Immunity - CORRECT ANSWERS Sovereign Immunity disallows an individual to sue a governmental entity; the waiver of sovereign