Insurance Contracts and Clauses: A Comprehensive Overview, Exams of Nursing

Download Insurance Contracts and Clauses: A Comprehensive Overview and more Exams Nursing in PDF only on Docsity! Florida Claims Adjuster Exam - 3 This optional provision states that if the insured becomes totally disabled, premiums are waived but the coverage remains in force: A. Waiver of Subrogation B. Waiver of Premium C. Waiver of Value D. None of the Above - ✔B. Waiver of Premium "premiums are waived" Frank owned a home that was destroyed by a hurricane. Both ABC and XYZ Banks were listed as additional interests on his homeowner policy. The insurance company will make a payment to: A. The first mortgagee, ABC B. The Insured C. Jointly to ABC and XYZ D. All listed interests - ✔D. All listed interests Remember that the insurer is not responsible to know the degrees of interest. In the event of a loss, one payment is made by the insurer and it is up to the additional interests on working out their share. Insurance applies *separately* to each insured as if other insureds did not exist. This is defined as: A. Severability B. Conditional C. Warranty D. None of the above - ✔A. Severability Property insurance policies usually contain a(n) __________ clause, stating the insured cannot *dump damaged property* on the insurer and demand its full value: A. Pro Rata B. Abandonment C. Liberalization D. All of the above - ✔B. Abandonment A(n) __________ is one wherein economic loss would be suffered from an adverse happening to the subject: A. Conditional Contract B. Personal Contract C. Economic Contract D. Insurable Interest - ✔D. Insurable Interest 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. A. Cancellation Clause B. Policy Period C. Pro Rata D. Liberalization - ✔D. Liberalization The time frame is typically 60 days. The __________ 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. A. Doctrine of Proximate Cause B. Doctrine of Perils & Hazards C. Insurance Policy Handbook D. Doctrine of Property Insurance - ✔A. Doctrine of Proximate Cause For example, if a property insurance policy covers the peril of fire but further damage is caused by smoke, water used to extinguish, and the process of moving property away - fire is considered to be the *proximate cause* of all of the damage. The Loss Settlement Valuation that subtracts an allowance for depreciation is defined as? A. Actual Cash Value B. Replacement Cost C. "Old for New" D. None of the Above - ✔A. Actual Cash Value *A policy condition,* either based on information in the insured's application or inserted by the insurer, is defined as: A. Warranty B. Misrepresentation C. Concealment D. None of the Above - ✔A. Warranty The following are basic characteristics of a property or liability insurance contract, except: 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? A. $15,000 B. $5,000 C. $3,000 D. $0, Frank is not-at-fault - ✔B. $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? A. Type of Construction B. Location of Risk C. Age & Gender of Insured D. Proximity to Fire Department - ✔C. Age & Gender of Insured On a Homeowner's Policy, covers items that are *not permanently attached to the dwelling.* This is defined as: A. Other Structures B. Excess Structures C. Personal Property D. Dwelling - ✔A. 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: A. Loss Payee Clause B. Mortgagee Clause C. Lender Clause D. Additional Insured Clause - ✔B. Mortgagee Clause Mortgagee - Homeowner's policy Loss Payee - Automobile policy Which of the following forms is "all-risk" on the dwelling policy? A. DP-1, or the Basic Form B. DP-2, or the Broad C. DP-3, or the Special Form D. None of the Above - ✔C. 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 - ✔C. 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 - ✔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 - ✔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 - ✔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 - ✔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: A. Preferred Risk Flood Policy B. Standard Flood Policy C. Universal Flood Insurance D. None of the Above - ✔A. 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: A. Condominium Dwelling Form B. Personal Condominium Unit Owners Form C. Condominium Unit Owners Form D. None of the Above - ✔C. Condominium Unit Owners Form Does not cover buildings since coverage would typically be provided under the Condo Association coverage form issued. 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 - ✔D. 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: B. Liability C. Personal Injury D. All of the Above - ✔A. Supplementary Generally, all costs of litigation are covered (court costs, prejudgment interest, judgement interest, cost of bonds to release attachments) Three full-time employees from a local furniture company are horsing around and one is pushed into a machine that cut his foot. How will the company's General Liability respond? A. The Med Pay Section must pay Primary B. The General Liability Policy will pay up to $20,000 in medical payments C. The GL policy will not pay D. Only property damage is covered under GL policy - ✔C. The GL policy will not pay Coverage excludes liabilities under Workers Comp or similar law or arising from injuries to employees of the insured. The employees would have to file through Workers Comp. Which of the following can be found in a Commercial General Liability Contract? A. Declarations B. Common Policy Conditions C. Occurrence and Claims-Made Forms D. All of the Above - ✔D. All of the Above Also included: Nuclear Energy Liability Exclusion endorsement (other endorsements may be attached) There is __________ coverage for injury, damage or clean-up costs caused by pollutants, subject to minor exceptions: A. 50% B. 10% C. 0% D. A Percentage Ratio - ✔C. 0% Under a Commercial General Liability Policy, a basic limit of __________ per person applies to Medical Payments: A. $1,000 B. $10,000 C. $2,500 D. $5,000 - ✔D. $5,000 Payment is for medical, dental, hospital, and funeral services incurred within one year of date of accident to persons who suffer bodily injury by accident 1. on or next to insured's owned or rented premises, or 2. due to insured's operations. The Commercial General Liability __________ *identifies* the named insured and address, states the policy period and premium and miscellaneous information about the insured, and specifies the limits of coverage that apply. A. Declarations B. Contract C. Policy D. None of the Above - ✔A. Declarations States the pertinent information of the policy The Nuclear Energy Liability Exclusion endorsement, in general, __________ all hazards related to nuclear energy. A. Includes B. Excludes C. Prohibits D. Summarizes - ✔B. Excludes Firms involved in Nuclear activities receive protection from special insurer pools organized for that purpose. Toxic wastes escaped from a gas station disposal tank. The insured operator discovers the leak and cleans up the spill. Unfortunately, the waste quickly seeped into the ground and has caused illness among the residents of a neighboring community This is an example of? A. Loss Known B. Known Loss C. Claims-Made D. None of the Above - ✔B. Known Loss Insurer should have been notified and further investigation of the spill and effective clean-up would have been observed. Applies to *BI or PD* which occurs during the policy period, regardless of any later time at which a claim is made: A. Occurrence Form B. Claims-Made Form C. Premises and Operations Exposure D. None of the Above - ✔A. Occurrence Form vs. Claims-Made: applies only to BI or PD occurring on or after retroactive date for which claim is received/recorded during policy period Applies only to a BI or PD which occurs on or after the retroactive date, and for which the *claim* is received or recorded by an insured or the company during the policy period: A. Occurrence B. Claims-Made C. Operations Completed D. None of the Above - ✔B. Claims-Made Retroactive date is stated in Declarations and will normally be same date as issuing company's first claims-made effective date for insured. All of the following are components of Workers Compensation, except: A. Up to $750,000 in Death Benefits B. Reimbursement for Medical Expenses incurred C. Reimbursement for lost wages on percentage basis D. Funeral costs up to $7,500 - ✔A. Up to $750,000 in Death Benefits Compensation for death is payable if death results within one year of an accident or if it follows disability within five years of accident. The following are classes of disability, except: A. Permanent Total B. Temporary Total C. Permanent Impairment D. Temporary Full - ✔D. Temporary Full Also included: Temporary Partial The measure to determine disability benefits is the __________ of the employee at the time of injury: A. Average Monthly Wage B. Average Weekly Wage C. Average Daily Wage D. Income Estimate - ✔B. Average Weekly Wage Disability - incapacity due to injury to earn same or any other employment wages that employee was receiving at time of injury. A. Primary B. Secondary C. Excess D. Recess - ✔C. Excess A situation may arise where another form of insurance will pay claim - that insurance would be primary. Cover only losses that both occurred and were discovered during the policy period, or within one year of its expiration. This is defined as: A. Discovery B. Loss Sustained C. Sustained Loss D. None of the Above - ✔B. Loss Sustained One exception to the rule is that Loss Sustained forms will also cover losses that occurred under previous (expired) crime policies and that were discovered during current policy year, as long as crime coverage had continued w/o interruption Any loss *discovered* during the policy period or within 60 days after its expiration (one year after expiration for losses connected with employee benefit plans) is covered regardless of when it occurred. This is defined as: A. Loss Sustained B. Valuation C. Discovery D. None of the Above - ✔C. Discovery If XYZ restaurant discovers stolen goods taken over a year ago, this is within 2 years of inception date and found within policy period so it's covered. Under Crime Insurance, the insured is covered for loss by: A. Theft B. Burglary C. Robbery D. All of the Above - ✔D. All of the Above Unless the loss is specifically excluded or limited Provides for loss of money and securities *outside the premises* in the care, custody and control of a messenger or armored car service resulting from theft, disappearance or destruction. This is defined as: A. Inside the Premises B. Outside the Premises C. Care, Custody, & Control D. None of the Above - ✔B. Outside the Premises Also covers robbery of other property under the circumstances. Taking or attempted taking of property from within a *locked safe* or vault, by unlawful entry, with visible marks of forcible entry, or taking of the safe or vault from inside the premises. This is defined as: A. Safe Burglary B. Inside the Premises C. Custodial Burglary D. None of the Above - ✔A. Safe Burglary Exclusions: accounting errors, giving/surrendering property, voluntarily parting, fire (except damage to safe/vault), vandalism, transferring property to someone based on unauthorized instructions or from threat to harm Covers for all types of property, when surrendered away from the premises as a result of a threat to do bodily harm to the insured or an employee, or to a relative or invitee of either, who is (or allegedly is) being *held captive.* This is defined as: A. Extortion B. Surrendered Property C. Client's Property D. None of the Above - ✔A. Extortion Also triggered by threats to damage the premises or property within the premises. Employee Theft Coverage may be written in the following ways: A. Scheduled Persons Coverage B. Scheduled Position Coverage C. Blanket Coverage D. All May Apply - ✔D. All May Apply Employee Theft may be written in three ways. Which of the following are NOT a type of bond? A. Contract B. Fiduciary C. Court D. Apprentice - ✔D. Apprentice Contract - fulfill obligation Fiduciary - make good to court for any deficiencies found in performance Court - protect opposing party from loss Which of the following are characteristics of a License Bond? A. To guarantee the licensee will act according to laws B. Protect public from unfair business practice C. Proper collection and payment of taxes D. All of the Above - ✔D. All of the Above Guarantees the performance between the principle and the obligee: A. Principal B. Obligee C. Surety D. All of the Above - ✔C. Surety aka Bonding Company; Surety is a "guarantee" This bond guarantees indemnification to the obligee for any losses resulting from the principal's failure to complete the contract work in accord with specifications: A. Performance B. Bid C. Court D. Maintenance - ✔A. Performance Considered a contract bond One who undertakes to perform, to fulfill a contract or to meet an obligation is known as: A. Principal B. Obligee C. Surety D. All of the Above - ✔A. Principal Obligee - needs guarantee principal will perform Surety - guarantees performance between principal and obligee This form of bond is required to accompany a *bid* for a contract which will require that the successful bidder furnish further bond if awarded the job: A. Bid B. Performance C. Court D. Maintenance - ✔A. Bid Some forms designed to supplement basic policies; others provide both basic and catastrophic coverage A policy may contain a provision which states a period of time between issuance and acceptance before sickness benefits begin. This is defined as: A. Waiting Period B. Elimination Period C. Both A & B D. None of the Above - ✔C. Both A & B This helps keep premiums reasonable by eliminating chance of persons buying coverage only when they are sick Characteristics of an HMO plan usually include: A. Small of non-existent Deductibles B. Fewer Exclusions C. Insurance services to members through employed physicians D. All of the Above - ✔D. All of the Above Also included: broad coverage, coinsurance provisions Provides indemnification to the insured for basic hospitalization of room and board in the hospital, nursing care, laboratory fees, operating room, medical supplies, etc. This is defined as? A. Hospitalization Expense B. Hospital Indemnity C. Accident Policy D. All of the Above - ✔A. Hospitalization Expense Associated with a daily limit, not to exceed specified maximum A(n) __________ provides comprehensive health services to its members for a prepaid fixed fee, equivalent to an insurance premium. A. HMO B. PPO C. Major Medical Plan D. All of the Above - ✔A. HMO Referred to as an emerging and increasingly important non-insurance alternative to dealing with risk of health care costs Established in 1973, this association was created for applicants who are unable to obtain insurance in the private market: A. FWCJUA B. FWUA C. Citizens D. FRPCJUA E. FAJUA - ✔E. FAJUA In 2002, the Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA) and the Florida Windstorm Joint Underwriting Association (FWUA), were combined to create: A. FWCJUA B. FWUA C. Citizens D. FRPCJUA E. FAJUA - ✔C. Citizens Passed during a legislative session in 1993, this association was created for employers who cannot obtain workers compensation insurance in the private market: A. FWCJUA B. FWUA C. Citizens D. FRPCJUA E. FAJUA - ✔A. FWCJUA A General Lines Agent instructs a licensed Customer Representative 4-40 to thoroughly cover the details of a new life insurance product with every Homeowner customer who calls or visits the office. The agent provides training on the new product. Although the Customer Representative does not have a Life License, he or she feels comfortable with the training and does as requested. Which of the following is true? A. This practice is acceptable if done in the office under supervision of General Lines Agent B. This practice is acceptable because adequate training and product knowledge was provided C. This practice is unacceptable and may result in the suspension or revocation of the Customer Representative's license D. This practice is only acceptable if the product training was certified by the Life Insurance Company - ✔C. This practice is unacceptable and may result in the suspension or revocation of the Customer Representative's license Unlike a Customer Representative, a General Lines Claim Adjuster need not be appointed with the Department of Financial Services. A. True B. False - ✔B. False While selling an Automobile policy to a customer, an agent tells them that they are also required to purchase an Emergency Road Service Plan, even though that is not true. This is an example of: A. Misrepresentation B. Lack of Fitness C. Deception D. Sliding - ✔D. Sliding A licensed General Lines Claim Adjuster is required to complete how many hours of continuing education every two years? A. 6 B. 12 C. 18 D. 24 - ✔D. 24 Once a Customer Representative 4-40 has been licensed and appointed for at least 3 years, he or she may transact insurance in the home of an existing customer. A. True B. False - ✔B. False After pleading guilty or no contest to a felony, a licensed individual has _________ days to inform the Department? A. 10 B. 20 C. 30 D. 40 - ✔C. 30 Must be licensed, appointed by a General Lines Agent and can transact AUTO insurance only in the Office Only. A. Customer Representative 4-40 B. Limited Customer Representative 4-42 C. General Lines Claim Adjuster 6-20 D. General Lines Agent 2-20 - ✔B. Limited Customer Representative 4-42 Defaming a competitor company or agent is not only unprofessional, it can also result in a license suspension. A. True C. Fee Adjuster D. Independent Adjuster - ✔A. Public Adjuster When investigating liability insurance claims, which of the following three major elements are determined: A. Coverage B. Liability C. Damages D. All of the Above - ✔D. All of the Above A relationship that requires maintenance of a high degree of *fidelity* and loyalty to the interests of the principal, whether or not the adjuster is a direct employee is defined as: A. Fiduciary B. Estoppel C. Public D. None of the Above - ✔A. Fiduciary Should always be maintained whether or not the adjuster is a direct employee An adjuster who is *self-employed* and not affiliated with either insurers or bureaus is defined as a(n): A. Fee Adjuster B. Public Adjuster C. Bureau Adjuster D. Independent Adjuster - ✔D. Independent Adjuster The adjuster's investigation may include all of the following except: A. Verification of Bills and Estimates B. Photographs C. Witness Canvasses D. Policy Cancellation - ✔D. Policy Cancellation The assertion of an alleged legal right against an insurer, which carries with it a demand for appropriate relief, is defined as: A. Adjustment B. Summons C. Claim D. None of the Above - ✔C. Claim Relieving the financial burden on the claimant by making certain payments to the claimant even *before* the claim can be negotiated is defined as: A. Advanced Payment B. Full Release Settlement C. Non-Advanced Payment D. Scheduled Payment - ✔A. Advanced Payment The process of disposing of an insurance claim is defined as: A. Adjusting B. Claims Management C. Adjustment D. None of the Above - ✔A. Adjusting Also "the negotiation period that results in an agreement" All of the following are requirements for the "Code of Ethics," except: A. Adjusters should not give legal advice B. Adjusters may negotiate with a claimant who is represented by an attorney C. A witness who requests a copy of a statement given must be provided with one D. Adjusters will keep an unprejudiced and open mind - ✔B. Adjusters may negotiate with a claimant who is represented by an attorney Adjusters MAY NOT. Bad, adjuster, bad! A written statement given by the insured to the insurer acknowledging that money received in the settlement of damages is received, not as a final payment, but as an advance pending an outcome of a claim against the person responsible for the damage. This is defined as a(n): A. Loan Receipt B. Subrogation Loan C. Full Release Statement D. Partial Release Statement - ✔A. Loan Receipt Enables insurer to bring an action for recovery against a third party Duties and functions of the Department of Financial Services include all of the following except: A. Approve the issuance of licenses B. Rating and underwriting rules C. Claims Supervision D. Investigate charges of unethical behavoir - ✔B. Rating and underwriting rules An adjuster who is a salaried employee under the supervision of the *home, branch, or regional claims department of insurers* is defined as a(n): A. Company or Staff Adjuster B. Fee Adjuster C. Public Adjuster D. Bureau Adjuster - ✔A. Company or Staff Adjuster Which of the following are not considered to be an adjuster: A. Employee or Staff Adjuster B. Independent Adjuster C. Public Adjuster D. General Lines Adjuster - ✔D. General Lines Adjuster Bureau Adjusters are also considered adjusters. An applicant for a license as an adjuster may qualify as an adjuster in the following fields (but not limited to): A. All lines of insurance except life and annuities B. Property and Casualty C. Workers Compensation Insurance D. All of the Above - ✔D. All of the Above Also: motor vehicle physical damage and health insurance A motor vehicle or mobile home which is a total loss is defined as: A. Lost Profit B. Salvage C. Salvageable D. All of the Above - ✔B. Salvage It cannot be restored to prior condition When making any payment for damage to an automobile for a partial loss, the insurer shall have printed on the loss settlement, "Failure to use the insurance proceeds in accordance with the security agreement, if any, could be a violation of s.812.014, Florida Statutes." This is payment for a(n): A. Third Party Claim B. Two Party Claim C. Derivative Claim D. All of the Above - ✔A. Third Party Claim A. Lack of Qualifications B. Failure to Pass State Examinations C. Fraudulent or Dishonest Practices D. All of the Above - ✔D. All of the Above Every licensee shall notify the department, in writing, after a change of name, residence address, principal business street address and/or mailing address within how many days? A. 60 B. 30 C. 15 D. 90 - ✔B. 30 An agent who transacts any one or more of the following types of insurance: Property, Casualty, Surety, Marine, and Health is defined as a(n): A. Customer Service Representative B. Adjuster C. Health Agent D. General Lines Agent - ✔D. General Lines Agent An agent representing a *health* maintenance organization, or as to health insurance only, an insurer transacting health insurance is defined as a(n): A. Health Agent B. Health Representative C. HMO Agent D. None of the Above - ✔A. Health Agent An applicant for a temporary license must be: A. A natural person at least 18 years of age B. A US citizen or legal alien who possesses work authorization C. Both A & B D. None of the Above - ✔C. Both A & B One who is duly *authorized* by a subsisting certificate of authority issued by the department to transact insurance in this state. This is defined as a(n): A. Unauthorized B. Certified C. Domiciled Insurer D. Authorized - ✔D. Authorized Actual Cash Value - ✔Replacement cost minus depreciation Subrogation - ✔When an insured has a right to collect damages from another party but elects to claim damages under his/her insurance policy; rights transfer to the insurer Loss Payee Clause - ✔Provides, in event of payment being made under the policy in relation to insured risk, that payment will be made to a third party rather than the beneficiary Mortgagee Clause - ✔Protects a lender who has an insurable interest in a home Grants special protection for the interest of a mortgage named in the policy; setting up a separate content between insurer and mortgagee Liability - ✔Negligence of the insured Other Structures - ✔Homeowner's Policy, covers items not permanently attached to main dwelling (shed, fence, etc.) Commercial Inland Marine - ✔Identifies risks which are eligible for either ocean or inland marine insurance Developed as extension to Ocean Marine coverage to provide coverage for cargo traveling over land instead of by sea Umbrella Policy - ✔- Covers much higher limit - Goes above/beyond claims directly relating to home and auto; - Protects assets from unforeseen events Known Loss - ✔Prevents insured from coverage if insured knew the loss was probable at time of contract Commercial Property Insurance - ✔Sometimes referred to as Commercial Fire and Allied Lines; Covers direct and indirect losses related to properties other than 1-4 family dwelling and farm properties Value Reporting - ✔Limit of coverage set at an amount higher than expected peak values Employee Theft - ✔Provides coverage for loss or damage to money, securities, and other property resulting from theft committed by an employee Bid - ✔Form of bond required to accompany a bid for a contract which will require that successful bidder furnish further bond if awarded job. Agreement to fulfill a contractual obligation used frequently in construction and supplying goods PPO - ✔(Preferred Provider Organization) Selected group of hospitals and medical practitioners in given area who have joined together in an effort to reduce medical costs HMO (pre-paid fixed fee) - ✔(Health Maintenance Organization) Provides comprehensive health services to its members for a prepaid fixed fee equivalent to an insurance premium Domestic - ✔Insurer formed under laws of this state Foreign - ✔Insurer formed under laws of another state, district territory, or commonwealth of U.S. Alien - ✔Insurer other than domestic or foreign (outside U.S.) Sliding - ✔Selling an item and stating that it is required by law Waiver - ✔Voluntary relinquishment or surrender of some right or privilege Fiduciary - ✔A relationship that requires maintenance of a high degree of fidelity and loyalty to the interests of the principal, whether or not the adjuster is a direct employee Evaluation - ✔Establishing a dollar value on a claim. Determines the fair payment in accordance with the contract and applicable law Negotiation - ✔A quality settlement based on facts discovered during the evaluation process Estoppel - ✔An equitable principle to the effect that if one intentionally or unintentionally creates the impression that a certain fact exists, an innocent party relies on that impression and is damaged as a result, the guilty party may be legally prohibited (estopped) from asserting that the fact does not exist. Junk - ✔Any material which is or may have been a motor vehicle or mobile home, with or without all component parts, which is inoperable and which material is in such condition that its highest or primary value is either in its sale or transfer as scrap metal Salvage - ✔Damaged property that may be retrieved, reconditioned and sold to reduce an insured loss. Motor vehicle or mobile home is a total loss Appointment - ✔Authority given by an insurer or employer to a licensee to transact insurance or adjust claims on their behalf -Death Benefits: if death results within one year of accident or, if it follow continuous disability, within five years after the accident What are the requirements for continuing education for a 6-20 license? - ✔A licensed General Lines Claims Adjuster is required to complete 24 hours of education every 2 years. Who might have an insurable interest in a property? - ✔Anyone who would suffer an economic loss from an adverse happening to the property What do the Declarations of a policy outline? - ✔The declarations identifies: - the named insured and address - states the policy period and premium and misc info - specifies the limits of coverage that apply Which parties are associated with a bond? - ✔-Principal: one who undertakes to perform, fulfill a contract, or meet an obligation -Obligee: one who is guaranteed that the principal will perform -Surety (Bonding Company): guarantees performance -Indemnitor: may act as additional party at times; agrees to reimburse the surety for any loss it may suffer from having bonded the principal What are the features of Major Medical Insurance? - ✔Major Medical Insurance is intended to afford protection against catastrophic losses. Some forms are designated to supplement basic hospital/surgical policies; others intend to provide both basic and catastrophic coverage These policies are characterized by a deductible, high maximum limit, and percentage participation or coinsurance. It may contain internal limits for hospital daily room charge and surgical services. What associations make up Citizens Property and Insurance? - ✔Florida Residential Property and Casualty Joint Underwriting Association (FRPCJUA) and Florida Windstorm Joint Underwriting Association (FWUA) What are the characteristics of a Personal Automobile Policy Declaration page? - ✔Liability (bodily injury), property damage, uninsured motorist, medical payments, PIP, collision deductible, comprehensive deductible, towing coverage, and rental coverage What are some examples of transacting insurance? - ✔1. solicitation and inducement 2. preliminary negotiations 3. effectuation of a contract of insurance 4. transaction of matters subsequent to effectuation of contract of insurance 5. mailing or otherwise delivering written solicitation to any person in this state by an insurer or any person acting on their behalf for fee or compensation What is the website for the Florida Department of Financial Services? - ✔www.myfloridacfo.com What are the thresholds of the No-Fault Law? - ✔(1) Significant and permanent loss of a bodily function, or (2) Permanent injury other than scarring and disfigurement, or (3) Significant and permanent scarring or disfigurement, or (4) Death. What is the Florida Unfair Insurance Trade Practices Act? - ✔Under this Act, penalties are provided for misrepresentation of business practices including: -Failing to act promptly -Failure to affirm or deny a claim when an insured is entitled thereto -Failure to explain claim denials in writing -Failure to maintain complaint-handling procedures, such as keeping accurate records of complaints What perils are covered by Comprehensive Coverage? Does the deductible apply to them all? - ✔Comprehensive Coverage applies to damage not caused by collision (an animal runs into your vehicle, hail damages your hood, glass claims, etc.) In Florida, windshields are replaced for free and you ARE NOT responsible for paying a deductible. What is the time frame for a Non-Renewable Temporary License? - ✔A period not to exceed 6 months What types of insurance licenses are offered by the Department and how do they differ? - ✔1. General Lines Agent 2-20: licensed to write property/casualty, surety or health insurance. 2. Customer Representative 4-40: must be licensed, appointed by a General Lines Agent and may assist in transactions in the OFFICE ONLY 3. Limited Customer Representative 4-42: must be licensed, appointed by a General Lines Agent and transact AUTO insurance in the OFFICE ONLY. 4. All Lines Claims Adjuster 6-20: investigates, Evaluates and Negotiates Claims What are some reasons for suspension, revocation, or termination of a license? - ✔1. Transacting insurance outside of scope of one's license ►For example, an individual cannot sell life insurance if he or she has a Customer Service license but has not obtained a life license. 2. Misrepresentation or Fraud. 3. Participating in unfair methods of competition. ►Using discriminatory practices, making false entries on an insurance application or defaming others. 4. Sliding: Selling an item and stating that it is required by law (when it is not). 5. Demonstration of unworthiness or lack of fitness. 6. Misappropriation of funds. 7. Failure to inform Department of Financial Services, within 30 days, after pleading guilty or no contest to a felony. Compare/contrast different types of adjusters. - ✔1. Independent Adjuster - self- employed and not affiliated with either insurers or bureaus 2. Company/Staff Adjuster - salaried employee under supervision of home, branch, regional claims department of insurers 3. Public Adjuster - represents the financial interests of the insured named in the policy 4. Claims Adjuster - one who is involved in the investigation, adjustment, negotiation and/or trial preparations of claims arising under insurance policies 5. Bureau Adjuster - agent of adjustment bureau which serves multiple company clients *Independent and Bureau are both "Fee Adjusters" What is an Insurance Contract? - ✔Insurance is a contract whereby one undertakes to indemnify another or pay or allow a specified amount or a determinable benefit upon determinable contingencies What are the components that make up the investigation process? - ✔Inquiry, verification, comparison What are the Code of Ethics for adjusters? - ✔Formal rules which impact on adjuster practices 1. Adjusters may not directly negotiate with a claimant who is represented by an attorney. 2. In interviewing witnesses, adjusters must avoid any actions tending to induce a suppression or deviation from the truth. A witness who requests a copy of a statement given must be provided with a copy. 3. Adjusters shall not give legal advice. 4. Adjusters shall not draft special releases; they are permitted only to fill in blanks of forms provided by the insurer. 5. Adjusters will not take advantage of an incapacitated claimant which would be to the detriment of the claimant. 6. Adjusters will not knowingly fail to advise claimants of their rights under contracts and laws of the state. 7. Adjusters will approach all aspects of the process with an unprejudiced and open mind, make truthful and unbiased reports, handle all processes with integrity and accept no remuneration other than that to which there is legal entitlement, and act with diligence and due dispatch in achieving proper disposition of claims. 8. The adjuster must put the duty for fair and honest treatment of the claimant above the adjuster's own interests, in every instance.