Level 1 Fundamentals of Insurance Practice Exam Correct 100%(RATED A)!!

Your client has made application for "appraisal". The intent of the appraisal process is to settle the dispute between your client and the insurer regarding the: a. Amount of the settlement being offered b. Denial of insurance coverage under the policy c. Right of the insured to purchase the salvage after an insured loss d. Premium charged to coverages being provided by the insurer - Answera An indifferent attitude towards losses because of the presence of insurance indicates the presence of: a. Gross negligence b. Physical hazard c. A material change d. Moral hazard - Answerd Insurable interest means the: a. Interest gained on money in a bank b. Interest payable on a loan c. Personal interest people have in something they expect to inherit d. Financial interest a person has in something of value - Answerd Every policy of "fire" insurance: a. Usually covers fire, smoke, and specified types of explosions b. Is required by law to cover fire, windstorm, and lightning c. Covers, fire, explosion, and windstorm d. Is required by law to cover at least fire, lightning, and specified types of explosions - Answerd Your client's insurance policy was cancelled for non-payment of premium. 6 days after the notice of termination was mailed, your client had a loss. a. The loss would not be covered because no premiums had been paid b. The mailing of the notice automatically cancels the policy after 5 days c. The loss is covered because 15 days' notice must be given by registered mail d. The loss would be covered but only in proportion to the time the policy was in effect. - Answerc Under a policy of "fire" insurance, the insurer must make payment for a loss within: a. 75 days after completion of the proof of loss. b. 90 days after completion of the proof of loss. c. 60 days after the completion of the proof of loss unless the contract provides for a shorter period. d. One year from the date the loss occurred. - Answerc Every property insurance policy describes the method used to pay claims. Normally the insurer will pay the lesser of three amounts in the event of a claim. One factor which does not enter into this calculations is the: a. Actual cash value of the property. b. Original cost of the property. c. Insured's interest in the property. d. Policy limit. - Ans