Florida Claims Adjuster Exam: Understanding Insurance Contracts and Clauses, Exams of Insurance law

Download Florida Claims Adjuster Exam: Understanding Insurance Contracts and Clauses and more Exams Insurance law in PDF only on Docsity! Florida Claims Adjuster Exam Questions and Answers. The following are basic characteristics of a property or liability insurance contract, except: A. Personal Contract B. Conditional Contract C. Loss of Settlement Contract D. Contract of Adhesion - Correct Answers Loss of Settlement Contract 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? A. Conditional Contract B. Adhesion Contract C. Indemnity Contract D. All of the Above - Correct Answers Conditional Contract "may be conditioned" If financial responsibility doesn't exist at the time of an accident, which of the following things must happen to avoid penalties? A. The legally valid claims of others must be satisfied (up to 10/20/10) B. The owner and operator must provide certification of future responsibility for future accidents C. Both A & B D. None of the Above - Correct Answers C. Both A & B 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 - Correct Answers 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 - Correct Answers C. DP-3, or the Special Form 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 - Correct Answers 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. 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 - Correct Answers D. All of the Above Also included: personal, non-business risk, no more than 2 roomers/boarders, condominium unit owners and cooperative apartment occupants 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 - Correct Answers 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 A. Declarations B. Common Policy Conditions C. Occurrence and Claims-Made Forms D. All of the Above - Correct Answers 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 - Correct Answers 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 - Correct Answers 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 Nuclear Energy Liability Exclusion endorsement, in general, __________ all hazards related to nuclear energy. A. Includes B. Excludes C. Prohibits D. Summarizes - Correct Answers 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 - Correct Answers 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 - Correct Answers 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 - Correct Answers 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. 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 - Correct Answers 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 - Correct Answers D. All May Apply Employee Theft may be written in three ways. 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 - Correct Answers A. Principal Obligee - needs guarantee principal will perform Surety - guarantees performance between principal and obligee May act as part of the bonding party and agrees to reimburse the surety for any loss it may suffer from having bonded the principal: A. Indemnitor B. Surety C. Obligee D. None of the Above - Correct Answers A. Indemnitor Known as "fourth party", may put up collateral This type of bond covers streets, sidealks, sewers, etc.: A. Sidewalk B. Subdivision C. Supply D. None of the Above - Correct Answers B. Subdivision Falls under Maintenance Bond Define the coverage that pays a flat amount per day for hospitalization, regardless of expenses or other insurance: A. Hospitilization B. Hospital Indemnity C. Hospital Services D. All of the Above - Correct Answers B. Hospital Indemnity 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 - Correct Answers B. Waiver of Premium "premiums are waived" or principal place of business and is licensed to act as an insurance agent. This is defined as: A. Business Territory B. Home Territory C. Home State D. None of the Above - Correct Answers C. Home State Any material which is or may have been a motor vehicle or mobile home, 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 or for its component parts, or a combination of the two. This is defined as: A. Junk B. Derelict C. Major Component Parts D. None of the Above - Correct Answers B. Derelict The authority given by an insurer or employer to a licensee to transact insurance or adjust claims on behalf of an insurer or employer is defined as: A. Appointment B. Express Authority C. Registered D. Certificate of Authority - Correct Answers A. Appointment Licensees are given authority through the appointment process Charging an applicant for a specific ancillary coverage or product, in addition to the cost of the insurance coverage provided for, without the informed consent of the applicant is a practice of: A. Churning B. Sliding C. Soliciting D. None of the Above - Correct Answers B. Sliding Loss Payee Clause - Correct Answers 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 - Correct Answers 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 Fiduciary - Correct Answers 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 - Correct Answers Establishing a dollar value on a claim. Determines the fair payment in accordance with the contract and applicable law Estoppel - Correct Answers 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. Implied Waiver - Correct Answers May result from some act of neglect on part of the adjuster Express Waiver - Correct Answers Occurs when insurer or its representative knowingly gives up a known right under insurance contract Identify examples of peril. - Correct Answers Fire, windstorm, flood after hurricane, etc. (something that causes a loss) How long does one have to notify the Department of Financial Services for a name and/or address change? - Correct Answers 30 days What do the Declarations of a policy outline? - Correct Answers The declarations 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