Texas Department of Insurance Exam
Questions with verified Answers
Adjuster - -The person who evaluates the damage caused by an accident or
other covered loss and determines the amount to be paid under the policy
terms.
- collision - -Pays for damages to your car caused by physical contact with
another vehicle or with another object, such as a tree, boulder, guardrail,
structure, or person.
- Claim - -Notice to an insurance company that a loss has occurred which
may be covered under the terms and conditions of the policy.
- Agent - -A license individual or organization authorized to sell and service
insurance policies for an insurance company.
- Comparative Negligence - -The percentage of a fault shared by each driver
n an accident in which both contribute to causing the collision.
- Comprehensive Coverage - -Pays for damage to your car caused by reason
other than collision, such as fire, theft, vandalism, windstorm, flood, ect.
- Risk - -The chance of financial loss or the uncertainty as to a loss.
- Pure Risk - -This deals with only the possibility of a reduction in the value
of something. There is no gain or profit involved.
- Speculative Risk - -In this situation there is a possibility of gain or loss.
- Indemnity - -To restore and insure to the same financial condition they
were in prior to the loss.
- Exposure - -Being subject to the possibility of loss because of a
surrounding risk or hazard.
- Peril - -A cause of loss.
- Hazard - -Any condition that increases the probability or severity of a loss
due to a covered peril.
- Physical Hazard - -Any hazard that can be seen, felt, or touched.
- Moral Hazard - -Any hazard that is illegal.
, - Morale Hazard - -Any hazard that is not illegal, such as carelessness to
possible loss due to insurance coverage. Example: Walking away from an
unlocked car.
- Loss - -Any reduction in quality, quantity, or value.
- Direct Loss - -The actual item damaged by a loss.
- Indirect Loss - -The consequence of the direct loss.
- Waiver - -Voluntarily relinquishment of a known right.
- Estoppels - -Involuntary relinquishment of a known right.
- Loss Ratio - -Paid losses vs paid premiums.
- Statue of Limitations - -Time limit established by law, usually 2 years 1
day.
- Deductibles - -Used to prevent small claims, also, it helps in reducing the
premium. Also known as the amount subtracted from any insurance loss paid
to insured.
- Book of Business - -The agent or insurance company's customers and
policy holders.
- Arbitration - -Used to resolve claim disputes. When an insured and the
insurer can't agree on the amount of a loss, the insured can make a written
demand to the other party. Both side will then pick an impartial appraiser.
The appraiser will pick an umpire. Each appraiser will make their appraiser
will make their appraisals separately and present only their differences to
the umpire, whoever the umpire agrees with is binding.
- Subrogation - -also known as "Right of Recovery" when an insured is
involved in an accident, an another party is at-fault, and the at-fault party is
taking too long to pay the claim, the insured's company can subrogate. The
insured will pay a deductible to their own insurance company and sign a
waiver, giving their insurance company the right to recover damages from
the at-fault party's insurance company., An insurer's right to recover the
amount of its loss payment from the third party who is legally responsible for
the loss.
- Salvage - -Is totaled out property deemed not repairable by the insurance
company.
Questions with verified Answers
Adjuster - -The person who evaluates the damage caused by an accident or
other covered loss and determines the amount to be paid under the policy
terms.
- collision - -Pays for damages to your car caused by physical contact with
another vehicle or with another object, such as a tree, boulder, guardrail,
structure, or person.
- Claim - -Notice to an insurance company that a loss has occurred which
may be covered under the terms and conditions of the policy.
- Agent - -A license individual or organization authorized to sell and service
insurance policies for an insurance company.
- Comparative Negligence - -The percentage of a fault shared by each driver
n an accident in which both contribute to causing the collision.
- Comprehensive Coverage - -Pays for damage to your car caused by reason
other than collision, such as fire, theft, vandalism, windstorm, flood, ect.
- Risk - -The chance of financial loss or the uncertainty as to a loss.
- Pure Risk - -This deals with only the possibility of a reduction in the value
of something. There is no gain or profit involved.
- Speculative Risk - -In this situation there is a possibility of gain or loss.
- Indemnity - -To restore and insure to the same financial condition they
were in prior to the loss.
- Exposure - -Being subject to the possibility of loss because of a
surrounding risk or hazard.
- Peril - -A cause of loss.
- Hazard - -Any condition that increases the probability or severity of a loss
due to a covered peril.
- Physical Hazard - -Any hazard that can be seen, felt, or touched.
- Moral Hazard - -Any hazard that is illegal.
, - Morale Hazard - -Any hazard that is not illegal, such as carelessness to
possible loss due to insurance coverage. Example: Walking away from an
unlocked car.
- Loss - -Any reduction in quality, quantity, or value.
- Direct Loss - -The actual item damaged by a loss.
- Indirect Loss - -The consequence of the direct loss.
- Waiver - -Voluntarily relinquishment of a known right.
- Estoppels - -Involuntary relinquishment of a known right.
- Loss Ratio - -Paid losses vs paid premiums.
- Statue of Limitations - -Time limit established by law, usually 2 years 1
day.
- Deductibles - -Used to prevent small claims, also, it helps in reducing the
premium. Also known as the amount subtracted from any insurance loss paid
to insured.
- Book of Business - -The agent or insurance company's customers and
policy holders.
- Arbitration - -Used to resolve claim disputes. When an insured and the
insurer can't agree on the amount of a loss, the insured can make a written
demand to the other party. Both side will then pick an impartial appraiser.
The appraiser will pick an umpire. Each appraiser will make their appraiser
will make their appraisals separately and present only their differences to
the umpire, whoever the umpire agrees with is binding.
- Subrogation - -also known as "Right of Recovery" when an insured is
involved in an accident, an another party is at-fault, and the at-fault party is
taking too long to pay the claim, the insured's company can subrogate. The
insured will pay a deductible to their own insurance company and sign a
waiver, giving their insurance company the right to recover damages from
the at-fault party's insurance company., An insurer's right to recover the
amount of its loss payment from the third party who is legally responsible for
the loss.
- Salvage - -Is totaled out property deemed not repairable by the insurance
company.
