FLORIDA CLAIMS ADJUSTER EXAM QUIZ WITH CORRECT ANSWERS

FLORIDA CLAIMS ADJUSTER EXAM QUIZ WITH CORRECT ANSWERS Insurance - CORRECT ANSWER-transfer of risk by contract to insurers who agree to indemnify insureds for losses Risk - CORRECT ANSWER-chance of loss pure risk - CORRECT ANSWER-only outcomes are loss or no loss personal risk - CORRECT ANSWER-premature death, insufficient income, poor health, unemployment property risk - CORRECT ANSWER-loss of real property or personal property (on the land not the land itself) Liability risk - CORRECT ANSWER-something that results in loss to another (3rd party buyout) Controlling risk - CORRECT ANSWER-risk management; minimal loss speculative risk - CORRECT ANSWER-either profit or loss is possible (NOT insurable) indemnify - CORRECT ANSWER-compensate for loss, damage, or injury; reimburse; repay Law of Large Numbers - CORRECT ANSWER-must have a large pool of insureds to be able to predict losses so that the outcomes will reflect the probability of the results Direct loss - CORRECT ANSWER-Results from the damage, destruction, or theft of property by a covered peril indirect loss - CORRECT ANSWER-a financial loss that results from the occurrence of a direct physical damage or theft loss When can there be a pay out on liability risk - CORRECT ANSWER-negligence is proven negligence - CORRECT ANSWER-failure to use due care; otherwise known as the prudent person rule Strict or Absolute Liability - CORRECT ANSWER-Liability assigned by statute without regard for negligence (set by the state or industry, no allowable defense) Indemnity Principle - CORRECT ANSWER-one should be in approximately the same position after a loss as he was before the loss Insurer - CORRECT ANSWER-A person or company that underwrites an insurance risk; the party in an insurance contract undertaking to pay compensation. Insured - CORRECT ANSWER-one who is named or covered by insurance Insurable interest - CORRECT ANSWER-must exist at the time of loss and usually means an economic or other interest in the event or in a particular property ex: bank loans or mortgage companies What is the measure of insurable interest - CORRECT ANSWER-the extent to which the insured might be damnified by loss, injury, or impairment thereof Policy - CORRECT ANSWER-a written document containing coverage, exclusions, conditions and endorsements Binder - CORRECT ANSWER-can be oral or written and places the insurance "in effect" Requirements of a valid contract - CORRECT ANSWER-consent of all parties (offer and acceptance), valuable consideration (monetary exchange), all parties must be of legal capacity (competent), and it must be for legal purposes to be enforceable Characteristics of an insurance contract - CORRECT ANSWER-personal, conditional, contract of adhesion (gray area, will side on the behalf of the insured), principle of indemnity, aleatory (exchange is not equal), unilateral (payment for a promise) Domestic insurance company - CORRECT ANSWER-A company that resides and is incorporated under the laws of the state in which it is operating Foreign Insurance Company - CORRECT ANSWER-An insurance company that is incorporated outside the state where it is conducting business Alien Insurance Company - CORRECT ANSWER-An insurance company incorporated outside the country Peril - CORRECT ANSWER-something that causes a loss ex: Fire, lightening Hazard - CORRECT ANSWER-something that increases the probability a loss will occur or increases the severity Physical hazard - CORRECT ANSWER-A physical characteristic that may increase the likelihood of loss (wet floor, icy roads) Moral hazard - CORRECT ANSWER-a conscious act that may cause a loss to occur (deliberate theft) Morale hazard - CORRECT ANSWER-an unconscious act that may cause a loss to occur (out of your control) Proximate cause - CORRECT ANSWER-if there is an unbroken chain of events from the occurrence and damage from that occurrence, all damage is a result of that occurrence (water damage from a fire) property insurance - CORRECT ANSWER-A type of insurance that covers damage to property, such as a home. Liability/Casualty Insurance - CORRECT ANSWER-Payable to a third party on behalf of the insured (bodily injury to another) assumption of risk - CORRECT ANSWER-A defense against negligence that can be used when the plaintiff was aware of a danger and voluntarily assumed the risk of injury from that danger. Comparative Negligence - CORRECT ANSWER-the apportioning of blame in an accident (both parties are at fault) actual cash value - CORRECT ANSWER-current cost less depreciation replacement cost - CORRECT ANSWER-current cost (no depreciation) valued policy - CORRECT ANSWER-pays the face amount of insurance if a total loss occurs Florida Valued Policy Law applies to - CORRECT ANSWER-total loss of a building, home or manufactured home based on insured value Coinsurance - CORRECT ANSWER-the sharing of expenses by the policyholder and the insurance company ex: a homeowner fails to increase insurance policy after renovations, therefore the DID/Should model is applied and the insurance company only pays out partially on the loss specific insurance - CORRECT ANSWER-When each property is named and specifically covered for a set amount blanket insurance - CORRECT ANSWER-When a single amount of coverage applies to any loss of property or injury up to the single limit amount (one bucket for multiple properties) mortgage clause - CORRECT ANSWER-establishes rights of mortgagee (lender) in the policy. Generally used in fixed property (real estate). Loss Payable Clause - CORRECT ANSWER-Establishes rights of a lender having interest in personal property. Sometimes called loss payee clause Subrogation - CORRECT ANSWER-when insured transfers right to his company to collect damages ex: collecting funds from an at fault driver's insurance company severability - CORRECT ANSWER-Insurance applies separately to each insured as if other insureds did not exist. (usually applies to spouses) liberalization - CORRECT ANSWER-used when a company increases benefits with no additional premium (new benefits extend to existing policy holders) warranty - CORRECT ANSWER-a guarantee of fact representation - CORRECT ANSWER-a material statement by applicant in an insurance situation misrepresentation - CORRECT ANSWER-A false statement or lie that can render the contract void. primary coverage - CORRECT ANSWER-must pay first Excess Coverage - CORRECT ANSWER-Coverage, which applies only after limits of primary insurance have been exhausted. See Primary Insurance. Part A (personal auto policy) - CORRECT ANSWER-liability coverage Part B (personal auto policy) - CORRECT ANSWER-Medical Payments Coverage Part C (personal auto policy) - CORRECT ANSWER-Uninsured/Underinsured Motorist Part D (personal auto policy) - CORRECT ANSWER-Damage to your auto Part E (personal auto policy) - CORRECT ANSWER-Duties after an accident or loss Part F (personal auto policy) - CORRECT ANSWER-general provisions where are loss payees listed on a personal auto policy - CORRECT ANSWERdeclarations pag