ADJUSTER PRO - INSURANCE ADJUSTER TEST(QUESTIONS AND REVIEWED ANSWERS)

ADJUSTER PRO - INSURANCE ADJUSTER TEST(QUESTIONS AND REVIEWED ANSWERS) What is insurance? - CORRECT ANSWER-protection against financial loss what is a premium - CORRECT ANSWER-a scheduled amount to be paid for an insurance policy. What are premiums used for - CORRECT ANSWER-premiums are collected into a "pool" or "reserve to pay out claimants when needed. how can insurance companies afford to pay for an individuals catastrophic loss? - CORRECT ANSWER-the insurer collects premiums from all policy holders and uses them to pay out the claims of a few. what is Indemnity - CORRECT ANSWER-payment for damages, that is not more or less than the amount caused by the damage. principle of idemnity - CORRECT ANSWER-insurance will pay no more or less than the actual financial loss suffered indemnification may also include - CORRECT ANSWER-repairs to property reimbursement for additional living expenses rental cars and hotels costs directly associated with a loss 4 Parts of Legal Contract - CORRECT ANSWER-1. Agreement 2. Consideration 3. Competent Parties 4. Legal Purpose legal contract - agreement - CORRECT ANSWER-mutual intent by offeror and offeree six special characteristics of insurance contracts - CORRECT ANSWER-1. Personal 2. adhesion 3. utmost good faith 4. aleatory 5. unilateral 6. conditional what kind of contract is an insurance policy? - CORRECT ANSWER-Personal contract what is a contract of adhesion - CORRECT ANSWER-the insured must accept the entire contract with all of its terms and conditions Utmost Good Faith - CORRECT ANSWER-An obligation to act in complete honesty and to disclose all relevant facts. Aleatory Contract - CORRECT ANSWER-a contract where the values exchanged may not be equal but depend on an uncertain event Unilateral Contract - CORRECT ANSWER-insurance agrees that they must pay in event of a claim. the insured can stop paying premiums at any point. only the insurer has promised to perform an action. Conditional Contract - CORRECT ANSWER-A type of an agreement in which both parties must perform certain duties and follow rules of conduct to make the contract enforceable. Acronym for the four sections of an Insurance policy - CORRECT ANSWER-DICE D - declarations page I - Insuring Agreement C- Conditions E - Exclusions Decelerations section - CORRECT ANSWER-Always the first section - establishes the following Names of both parties Policy number Location and description of insured item Dates of the policy Amount and limit of coverage Deductible Premium Definitions section - CORRECT ANSWER-Defines terms used to write policy including "collusion" "decay" "like kind and quality" Includes important language for adjusters to know Insuring agreement section - CORRECT ANSWER-What is covered and how Which causes of loss are covered Any services provided Any exclusions to coverage The maximum limit of policy coverage in dollars Conditions section - CORRECT ANSWER-Insurer specifies any limits or qualification