CLAIMS ADJUSTER'S EXAM (FL) QUESTIONS WITH CORRECT ANSWERS GRADED TO PASS

All of the following describe insurable interest EXCEPT - -Insurable Interest must exist at the time of the loss. -Insurance Interest must exist for insurance to respond. *Show a similarity between insurance and wagering* -The insured would suffer an economic loss. An Insurance Policy is a contract with all of the following characteristics, EXCEPT - -It is a personal contract. -Parties are of unequal power with ambiguities or unclear wording resolved in favor of the insured because it is a contract of adhesion. *Indemnity is not part of an insurance contract* -There are conditions imposed upon both the insurer and insured. An insurance contract may contain a "gray area" or an ambiguity, that is generally resolved in favor of the insured because insurance policies are contracts of: - -Indemnity -Cohesion *Adhesion* -Conditions If an insured sells his car to another person, the buyer may be prohibited from also receiving the insured's policy. This is because the insurance contract is a contract of: - *Personal nature* -Indemnity -Adhesion -Actual cash value Strict or absolute liability: - -applies to school systems. -must have failure to use "due care." -considers the actions of a prudent person. *is assigned by law or statute* Jack and Connie - both 50 years old and of sound mind - agree to have Jack burn down Connie's house for $10,000. What element of a valid contract is missing? - *Legal purpose* Competent parties Consideration Agreement of the parties Risks that are insurable are: - Speculative risk *Pure risk* Both A & B None of the above Insurance that covers the responsibility for loss arising out of policy holder's negligence - that results in payment to a party other than the insured is: - Not available in Florida insurance policies Fourth party claims Standard property insurance *Liability* The goal of insurance is to restore the insured to the same economic position as before the covered loss occurred, this is the principle of: - Adhesion Actual Cash Value *Indemnity* Severability Liability limits may be expressed as a: - -Aggregate Limit -Split Limit -Single Limit *All of the above* An insured has A SPLIT limit liability policy with 10/20/10 limits. He owes the following people liability bodily injuries claims of: Passenger 1 = $12,000, Passenger 2 = $10,000, Passenger 3 = $18,000. How much liability insurance will his policy pay for these claims? - -$ 10,000 *$ 20,000* -$ 30,000 -$40,000 If a lender has an insurable interest in an auto, because of the money loaned to finance the auto, the lender would appear on the policy as the: - -Lessee *Loss payee* -Mortgagor -Mortgagee To turn partially damaged property over to the insurance company and ask them to pay for a total loss is called - -Morale hazard *Abandonment* -Conveyance -Proof of Loss Firemen caused water damage to a property by spraying water to put out a fire. If the property insurance policy listed "fire" as the only named peril: - -The water damage is not a covered. -The fire dept. has liability for the water damage. *The water damage is covered due to the concept of proximate cause* -The Fire damage is covered but not the water damage due to proximate cause. XYZ Insurance Corp. filed its corporate charter in Tallahassee and has its home office in Tampa: - *In Florida, XYZ is a domestic insurer* In Florida, XYZ is a foreign insurer. In Florida, XYZ is an alien insurer. None of the above is true. An insured has a home with a replacement cost / value of $100,000, on which he carries an insurance policy for $80,000 with an 80% Coinsurance clause. The insured has a $20,000 partial loss, the insurance company will pay how much for this partial loss of $20,000? (Remember $80,000 is 80% of $100,000) - *20,000* 16,000 80,000 - 0 - "Actual Cash Value" ACV means: - -Replacement cost -Original cost minus depreciation -Current cost to replace *Current cost to replace minus depreciation* Which of the following is TRUE concerning Subrogation? - *Allows the insured to collect twice for the same loss.* -Allows the insurer to sue a negligent third party to recover a loss paid. checkmark -Requires 70% co-insurance. -May allow insurer to divide the interests of the insureds. An insurer may sever the interests of 2 insureds so that the insurer can protect an innocent party - this is the Doctrine of: - -Division of Interests *Severability* -Specific Insurance -Insurability All of the following may qualify for a dwelling policy EXCEPT: - * A 6 - family dwelling checkmark* -A beach house owned by Acme Corporation -A small single family home, rented by a salesman -An old frame home, built upon piers, valued at $10,000 and occupied by the owner, Mrs. Jones. Company underwriting minimum for a homeowner policy is $50,000. All of the following are eligible for a Homeowners Policy EXCEPT: - -A person who rents an apartment -A condominium owner -Owner-occupant of a four-family dwelling *A beach house owned by Acme Corporation* The principle of "insurable interest" is important in the dwelling policy as well as other kinds of insurance. Which of the following does not have " insurable interest" in the described property? - -The one who holds title to the property -One who inherits title to property under the terms of a will *One who attends a Mary Kay party at a friend's property* -A bank who holds a mortgage on a described property Aunt Mary lives with the insured Homeowner. A thief steals her hearing aid. The HO-3 will: - *Cover within the limits of the H/O policy* -Not cover, unless the "guest endorsement" is included -Not cover, unless the "tenant endorsement" is included -None of the above