USAA P&C INSURANCE ADJUSTER EXAM
Perils - Answer -Causes of loss identified in the policy (Fire, lightening, internal
explosion ,Wind, Hail, Collision)
Hazard - Answer -Condition that create or increases the chance or loss or contributes
to the loss
Physical Hazard - Answer -Visible ( operational features of a risk)
Moral Hazard - Answer -Intentional dishonesty or illegal actions of a person (arson)
Morale Hazard - Answer -Carelessness or indifference ( attitude). Takes additional
risks (negligence)
Pure Risk - Answer -Chance of loss. Insurable
Law of Large Numbers - Answer -Law of average. Helps predict future losses
accurately (sets pricing for insurance)
Speculative Risk - Answer -Chance of gain/loss. NOT Insurable (gambling)
The 4 Parts of an Insurance Contract - Answer -D.I.C.E
Declarations,
Insuring Agreement,
Conditions,
Exclusions
Declarations - Answer -Who is insured (dec sheet) Contains:
Policy Number, Premium, Term (Period of Coverage), Policy Limits, Person/Property
Risk - Answer -The chance of loss or uncertainty of loss
Direct Loss - Answer -Immediate actual physical damage to tangible property
Indirect Loss - Answer -Inability to use property as a result of direct Loss ( loss of use)
Conditions - Answer -Duties or responsibility of both the insured & insurer
Primary Policy - Answer -This policy pays FIRST.
Excess Policy - Answer -This policy pays AFTER primary has been exhausted
Pro Rata - Answer -Applies when both polices are primary, they will pay on a
proportional basis (bigger policy pays more) Equal limits 50/50
, Insuring Agreement - Answer -Insurance Company's promise to pay. Tells us what
peril/s the policy covers
Supplementary Payments - Answer -B.A.I.L.E.D
Bonds- (Max $250)
Aid- First aid expenses
Internet- Judgements in appeal
Loss of Earnings- Up to $250 per day in defending investigation claim
Expenses- Incurred by the insured to assist in defense of a claim
Defense Costs- Paid with no limit
Insurable Interest - Answer -The loss would cause you financial hardship
ISO - Answer -Insurance Services Office
Policy Territory - Answer -Where coverage applies. US, Canada, Puerto Rico
ACV - Answer -Replacement cost value - depreciation= Actual cash value
Replacement Cost Value - Answer -To insure for atleast 80% of the value of the
property
Subrogation - Answer -The insured gives the insurer legal right to go after the party
who was responsible for the insured's loss
Cancelation Clause - Answer -Cancelled midterm by insured-Short rate refund
Cancelled midterm by Insurer- Pro Rata refund
Assignment - Answer -Insured requests payment of the claim to 3rd party. Must be
made in writing. Insurer must approve. Not in the case of death
Liberalization Clause - Answer -No action needed by Insured. No additional premium to
be paid by the insured. The insurer must offer the enhanced or increased limits of
coverage to all insureds that have like policies
Pro Rata Clause - Answer -More than one company provides coverage on the same
property. The bigger policy pays proportionally more than the smaller
Concurrent- Two different policies Insuring the same perils
Nonconcurrent- Two different policies Insuring separate perils
Indemnity - Answer -No loss no gain
Suing - Answer -Lawsuit must be started within two years and one day of loss
Perils - Answer -Causes of loss identified in the policy (Fire, lightening, internal
explosion ,Wind, Hail, Collision)
Hazard - Answer -Condition that create or increases the chance or loss or contributes
to the loss
Physical Hazard - Answer -Visible ( operational features of a risk)
Moral Hazard - Answer -Intentional dishonesty or illegal actions of a person (arson)
Morale Hazard - Answer -Carelessness or indifference ( attitude). Takes additional
risks (negligence)
Pure Risk - Answer -Chance of loss. Insurable
Law of Large Numbers - Answer -Law of average. Helps predict future losses
accurately (sets pricing for insurance)
Speculative Risk - Answer -Chance of gain/loss. NOT Insurable (gambling)
The 4 Parts of an Insurance Contract - Answer -D.I.C.E
Declarations,
Insuring Agreement,
Conditions,
Exclusions
Declarations - Answer -Who is insured (dec sheet) Contains:
Policy Number, Premium, Term (Period of Coverage), Policy Limits, Person/Property
Risk - Answer -The chance of loss or uncertainty of loss
Direct Loss - Answer -Immediate actual physical damage to tangible property
Indirect Loss - Answer -Inability to use property as a result of direct Loss ( loss of use)
Conditions - Answer -Duties or responsibility of both the insured & insurer
Primary Policy - Answer -This policy pays FIRST.
Excess Policy - Answer -This policy pays AFTER primary has been exhausted
Pro Rata - Answer -Applies when both polices are primary, they will pay on a
proportional basis (bigger policy pays more) Equal limits 50/50
, Insuring Agreement - Answer -Insurance Company's promise to pay. Tells us what
peril/s the policy covers
Supplementary Payments - Answer -B.A.I.L.E.D
Bonds- (Max $250)
Aid- First aid expenses
Internet- Judgements in appeal
Loss of Earnings- Up to $250 per day in defending investigation claim
Expenses- Incurred by the insured to assist in defense of a claim
Defense Costs- Paid with no limit
Insurable Interest - Answer -The loss would cause you financial hardship
ISO - Answer -Insurance Services Office
Policy Territory - Answer -Where coverage applies. US, Canada, Puerto Rico
ACV - Answer -Replacement cost value - depreciation= Actual cash value
Replacement Cost Value - Answer -To insure for atleast 80% of the value of the
property
Subrogation - Answer -The insured gives the insurer legal right to go after the party
who was responsible for the insured's loss
Cancelation Clause - Answer -Cancelled midterm by insured-Short rate refund
Cancelled midterm by Insurer- Pro Rata refund
Assignment - Answer -Insured requests payment of the claim to 3rd party. Must be
made in writing. Insurer must approve. Not in the case of death
Liberalization Clause - Answer -No action needed by Insured. No additional premium to
be paid by the insured. The insurer must offer the enhanced or increased limits of
coverage to all insureds that have like policies
Pro Rata Clause - Answer -More than one company provides coverage on the same
property. The bigger policy pays proportionally more than the smaller
Concurrent- Two different policies Insuring the same perils
Nonconcurrent- Two different policies Insuring separate perils
Indemnity - Answer -No loss no gain
Suing - Answer -Lawsuit must be started within two years and one day of loss
