NC NORTH CAROLINA INSURANCE ADJUSTER EXAM 2024 (QUESTIONS WITH CORRECT ANSWERS) GUARANTE, Exams of Insurance law

Download NC NORTH CAROLINA INSURANCE ADJUSTER EXAM 2024 (QUESTIONS WITH CORRECT ANSWERS) GUARANTE and more Exams Insurance law in PDF only on Docsity! Highflier Scoremore NC NORTH CAROLINA INSURANCE ADJUSTER EXAM 2024 (QUESTIONS WITH CORRECT ANSWERS) GUARANTEED PASS Torts that can be covered by insurance policies include all of the following, EXCEPT: Intentional torts purposely committed to cause harm to another. The insured has a $1,000,000 personal umbrella policy with a $5,000 retention limit. For a $7,000 liability loss not covered under the insured's personal auto policy, but covered under the umbrella policy, the insurance company would pay: $2,000 All of the following is considered an "insured" under a CGL policy, EXCEPT: Lawyers of the named insured Manny is purchasing a Commercial Property policy with a Business Income form included. Manny can select from any of the following as a method to provide coverage, while avoiding the coinsurance requirement, EXCEPT: The maximum monthly limit of indemnity optional coverage The traditional definition of actual cash value (ACV) is: Replacement cost minus depreciation Sam and Dan are working to clean out the gutters around the roof on Sam's house. Sam and Dan are standing at the top of separate ladders that are propped against the side of Sam's house, when Dan's Highflier Scoremore ladder begins to wobble and ultimately falls into Sam's ladder. Both men and their ladders crash to the ground. Whose injuries will be covered by Sam's Homeowners policy under Coverage E - Personal Liability? Only Dan's injuries would be covered What specific type of liability policy gives an owner protection against liability claims arising out of the acts of its independent contractors? Owners and Contractors Protective Liability Policy. Which of the following would be eligible for coverage under a Businessowners policy? A small retail store Which of the following is NOT a correct statement in determining the cost of a "comparable automobile" when a physical damage loss has a occurred? The cost of a comparable automobile as determined by a computerized automobile valuation service that produces statistically valid fair market values within the United States market All of the following statements are TRUE of North Carolina automobile liability policies, EXCEPT If the insured carries limits greater than the minimum financial responsibility limits required by state law, they are not required to carry Uninsured/Underinsured Motorists coverage. The basic limit for Coverage F -- Medical Payments of the standard Homeowners forms is: $1,000 per person Oliver Dogwood was in an auto accident which destroyed his car. While investigating the accident, Adjuster Doright found that Mr. Dogwood paid $1,000 for the vehicle. After checking with others he Highflier Scoremore $30/60/25 Many states amend property insurance coverage additions and extensions by statute due to insufficient coverage amounts or time limits. All of the following are property insurance additions or extensions that are frequently amended by state statute, EXCEPT: Other Structures How are household personal property claims settled under the farm policy? Actual cash value Which policy would be best for a prospective insured who wants coverage against liability assumed by him under specific written agreements? Contractual Liability provided under a CGL policy North Carolina law prohibits any Fire insurance policy covering property within the state of North Carolina to be issued for a term: Longer than seven years Collin suffered a work-related injury on the morning of February 5th and was off work completely until he returned to work on full duty on February 19th. Collin had worked for his employer for four years and was paid $42,125 per year. Collin's state sets the TTD rate at 66 2/3rd percent of the average weekly wage. The state sets the maximum compensation rate at $420 per week and the waiting period at 3 days retroactive after 10 days. Collin was not paid for working on February 5th, so how many days of TTD compensation is Collin entitled to receive? 14 Highflier Scoremore All of the following are examples of insurable interest in property, EXCEPT: The interest an individual has in the property her parents will someday leave to her. George went out for target practice one day with his handgun. He has practiced many times with the same target located in the woods behind his house. Unbeknownst to George, a neighbor was walking in the woods behind the target one day and was shot in the leg by George. Intentional acts are never covered by insurance, however, the claim filed by the injured neighbor may be covered under George's liability coverage. Which of the following is the most likely reason why? Shooting the gun was an intentional act committed by George, but the consequences of act (his neighbor being shot) were not intended The duties of the insured after a loss are included in insurance policy language to: Assist in the adjuster's investigation of the claim The perils insured against by a Homeowners policy are contained within the: Insuring Agreements Under a standard HO-3, the limit for Coverage C -- Personal Property for a one or two-family dwelling: Is set at 50% of Coverage A Which of the following flood zones show a "flood depth" instead of a "base flood elevation" on a FIRM? AO North Carolina law stipulates that buildings located within the state that are covered under a Fire policy and suffer a total loss, the insurance company: Highflier Scoremore Is not liable to pay amounts beyond the actual cash value of the insured property at the time of the loss or damage Which of the following is generally not considered to be a legal defense against claims of negligence? The loss to the plaintiff was caused intentionally by the defendant. . All of the following are true regarding the "Write Your Own" program of the NFIP, EXCEPT: Insurers are required to participate in the program How are death benefits calculated for an employee who has died as a result of a work related incident? 66 2/3% of the employee's average weekly wage for 500 weeks Sharon's North Carolina home is covered under a Homeowner's policy with a "Refrigerated Property Coverage" endorsement attached. She stores large amounts of expensive meats in her freezer at any given time. One morning, she doesn't hear the low hum of her freezer motor. When she opens her freezer door, she finds that the freezer is no longer cold and all of her meat has spoiled. Sharon collects her receipts and finds that the price of the spoiled meat totals $658 and she submits a claim for this loss. How much will her insurer pay? $500 Which of the following terms does NOT apply to workers compensation coverage in North Carolina? Temporary sick leave with benefits Coverage D - Loss of Use on the Homeowners forms provides coverage for "Civil Authority Prohibits Use" for: Highflier Scoremore Drive Other Car endorsement Under the "Money Orders and Counterfeit Money" insuring agreement of a standard Commercial Crime form, all would be covered, EXCEPT: Taking a forged check from a customer in exchange for merchandise.. Which of the following statements is TRUE regarding nonwaiver agreements and reservation of rights letters? The are used only with first-party claimants to protect the rights of insureds and insurers. All of the following are reasons that an adjuster should keep very detailed log notes, EXCEPT: To produce notes that will support a fraudulent denial of claims. All of the following are excluded under the Commercial Building and Personal Property form, EXCEPT: Furniture and fixtures An insured carries property insurance with a limit of $25,000 and an 80% coinsurance requirement. The covered building, however, is worth $40,000. How much would she collect in the event of a total loss? $25,000. A guest on vacation deposits cash and traveler's checks in the hotel safe deposit box located behind the front desk. When the guest attempts to retrieve them, the box is empty. What coverage is required to cover this loss for the hotel? Guests property Highflier Scoremore Public adjusters: Adjust first-party property loss claims. The custom farming endorsement is usually attached to a farmowners policy when receipts exceed: $5,000 Which of the following statements is correct regarding pollution coverage under the special cause of loss form of a Commercial Property policy? It is excluded unless it was caused by a covered peril With respects to insurers writing auto coverage in the North Carolina, which of the following is true regarding the North Carolina Motor Vehicle Reinsurance Facility? All insurance companies writing auto coverage must participate in this program Underground gasoline tanks on an insured's property leak damaging the property next door. Which policy would pay for clean up? Pollution Liability endorsement The insured is liable for $500,000 in damages for a personal injury claim that is covered under the insured's primary liability policy. The primary liability policy has a $300,000 limit per occurrence. The insured also has a $1 million Umbrella policy with a $3,000 self-insured retention limit. How would this claim likely be settled? The primary policy would pay $300,000 and the Umbrella policy would pay $200,000 Highflier Scoremore A customer has eaten seafood in a restaurant and became very ill while still in the restaurant. What type of CGL claim is this? Products Liability All of the following statements are true regarding a Personal Umbrella policy, EXCEPT: The policy can be written as a monoline policy Which of the following would be considered "economic losses" that could result in compensatory damages being awarded in a negligence case? Medical expense and lost wages Farm liability coverages include each of the following, EXCEPT: Professional liability Which of the following statements about the Standard Fire Policy is correct? I. A covered fire must be hostile, not friendly. II. Lightning includes artificially generated electrical current. I only Gavin operates a small manufacturing plant and is covered under a Commercial Property Business Income form. Under which of the following scenarios will Gavin be covered? His loss of profit while out of business as a result of a fire loss Highflier Scoremore If the insured, covered under a Homeowners policy, suffers the loss of an article that is part of a pair or set. All of the following are options for the insurer to settle the loss, EXCEPT: Pay for the replacement cost of the entire pair or set When someone dies without a will, their assets will be handled by a court appointed: Administrator. Emily owns a home that she has covered under a Homeowners policy. Because Emily lives alone, she had to leave her home and stay with her parents for the past six months while she recovers from major surgery. Except for the day-to-day items that Emily needs while she stays at her parents' home, all of her other belongings are still located in her home. Which of the following best describes the condition of Emily's home? Unoccupied The insured carries a yacht policy. One of the crew members is injured while performing a work related task. What coverage must be added under the policy that would respond to cover the crew member's injuries? Jones Act In most states, which of the following most accurately describes an "admitted insurer"? An insurer that can transact insurance in the state under a certificate of authority The wording of the Standard Fire policy is so vague that many insurers have to rely on __________ to take a position on the acceptance or denial of a claim. Case law Highflier Scoremore Under the North Carolina personal automobile policy, the number of days an insured has to report a newly acquired vehicle to the insurer is: 30 days The additional coverage of the Commercial Property cause of loss forms known as the "Limited Coverage for Fungus, Wet Rot, Dry Rot, and Bacteria" provides: $15,000 coverage for all occurrences within a 12-month period The broad and special dwelling forms (DP-2 and DP-3) will provide replacement cost coverage for buildings if the amount of insurance written on the building is at least: 80% of the full replacement cost at the time of the loss Under a Businessowners policy, the "Hired and Nonowned Auto Liability" endorsement would cover: Vehicles borrowed by the insured Which of the following coverage endorsements under commercial crime and bonding would cover an ATM machine? Automated Teller Machine Coverage Which part of an insurance policy sets the rules of conduct, duties, and obligations of the insured and insurer under the terms of the insurance contract? Conditions Highflier Scoremore The condition "Legal Action Against Us" in a CGL policy requires the insured to: Comply with all of the terms of the policy Which of the following is NOT one of the three main (general) coverages of the Building & Personal Property coverage form? Property damage liability coverage A typical boatowners policy includes all of the following coverages EXCEPT: When used to carry cargo for others for a fee The Coverage C - Uninsured Motorists coverage of a standard, unendorsed Personal Automobile policy applies to all of the following, EXCEPT: Property damage sustained by the insured vehicle by an uninsured vehicle Which of the following is not a subject for supplementary payments under a CGL policy? Expenses for first aid at the time of an accident. Which of these statements best describes "the law of agency?" A relationship in which someone is authorized by contract to represent another party.. In connection with the bonding business which of the following statements is NOT true? A surety bond protects the principal from sustaining a loss. Highflier Scoremore Actual cash value. Which of the following is included in the Supplementary Payments under a standardized Personal Automobile policy? Interest accruing after a judgement is entered (post-judgement interest). Pete's business is covered by a standard Businessowners policy. He has been accused by a customer of displaying inaccurate pricing on his website. Which of the following statements best describes how this claim would be handled by the BOP? Coverage for any claim caused by a wrong description of the price of goods, products or services is excluded by the personal and advertising injury coverage of the BOP The National Flood Insurance Program will pay which of the following amounts to assist with moving of property to safety when there is imminent flood danger? $1000 Which sections of the Standard Fire policy are found on the first page of the policy? The Declarations page and the Insuring Agreement Kim owns an Art studio where she offers painting lessons and sells painting and art supplies. She carries a Commercial General Liability policy to cover her business. Which of the following situations would be covered by Kim's CGL insurance? A client slips and falls on wet paint that was dripped on the floor in Kim's art studio. The client breaks her arm. Highflier Scoremore The North Carolina Insurance Code has established a penalty for willfully making false statements in a financial statement. The violator is considered: Guilty of a Class I felony and can be subject to a fine of not less than $2,000, nor more than $10,000 To be eligible for coverage under a standardized Dwelling policy, the insured must not allow more than _______ boarders to live on the premises. 5 Jeff has his 1974 Pontiac Firebird Trans-Am SD-455 covered under a standardized personal automobile policy. He has had a full restoration done to both the interior and exterior of his muscle car and he can't wait to show it off. When Jeff's buddy Dale sees the car, he challenges Jeff to race against him in his 1971 Chevy Camaro SS350. Jeff accepts the challenge and the two men set a date for the following week. The following week, many people find out about the race and come out to watch on race day. Shortly after the race begins, Jeff loses control of his car when a tire blows out and he swerves into the crowd of people watching the race, injuring several. He is sued for bodily injury. Which of the following statements best describes how Part A of Jeff's personal auto policy will cover the costs to defend the claims against Jeff? The insurer will not defend against the claim because it is not covered under the policy Coverage for all reasonable expenses incurred by an insured in order to continue as nearly as practicable the normal operation of his/her business after a loss is: Extra Expense Coverage. All of the following statements are TRUE about Workers Compensation benefits, EXCEPT: Waiting periods apply to medical and disability benefits. All of the following are exceptions to the workers' compensation exclusive remedy, EXCEPT: An on-the-job injury caused by worker fatigue from working an excessive number of over-time hours.. Highflier Scoremore Under a Business Auto policy, which coverage symbol indicates that a car is subject to mandatory no- fault insurance as required by state law? 5 Philip has several vehicles that are all covered under Personal Automobile policies. He has several acres of land with a barn and chicken coup on the property. To drive around on the acreage, Philip has a very old truck that is not licensed or insured. One afternoon, Philip is driving out to check on his cows when he hits a rut and his head slams down on the steering wheel, injuring him severely. How will Part B - Medical Payments provide coverage for Philip's injuries? Bodily injury sustained while occupying an uninsured auto owned by the insured is excluded under Part B, therefore no coverage would apply An insured who would like to cover an employee while driving their own car on company time would need which of the following endorsements? Employees as Insureds endorsement Under the "Emergency Program" in all states except Alaska and Hawaii, the National Flood Insurance Program will insure a single-family residence for up to: $35,000. Which of the following statements is true about the Standard Fire Policy? Standard Fire Policy is no longer used in its original format Which of the following Commercial Property cause of loss forms include the additional coverage for "Fungus, Wet Rot, Dry Rot, and Bacterial"?