West Virginia Adjuster UPDATED
ACTUAL Exam Questions and CORRECT
Answers
What is NOT a factor in establishing negligence on the insured's part? - CORRECT
ANSWER - There is a breach of protection.
One characteristic of an insurance contract is that both parties must perform certain acts to assure
that the contract is legally enforceable. This is called...? - CORRECT ANSWER - Executory
The responsibility of the federal government in the regulation of the insurance industry is limited
to what? - CORRECT ANSWER - Fair Labor Standards and Anti-trust Matters
An insurer who issues a statement that misrepresents the benefits, advantages, conditions or
terms of any insurance policy would be guilty of: - CORRECT ANSWER - Misrepresentation
and False Advertising
The insurance department has been advised that an agent is guilty of insurance code violation.
The Commissioner will: - CORRECT ANSWER - Call for a hearing
What could be considered an Unfair Trade Practice? - CORRECT ANSWER - Twisting,
Rebating, and Coercion are all Unfair Trade Practice
What is NOT considered to be an unfair claims practice? - CORRECT ANSWER - Failing to
honor an uncovered claim
Although their liability is clear, BB&S Insurance Company routinely delays all claim payments
for 90 days, and in doing so: - CORRECT ANSWER - Is guilty of unfair claim settlement
practice
Which of the following would be considered unfair or deceptive acts by an adjuster?
,A. Requesting that a first party claimant signs a release that extends beyond the subject matter
which gave rise to the claim payment.
B. Advising the claimant that their rights may be impaired if a form of release is not completed
within a specified period of time unless for the purpose of notification of statute of limitations.
C. Issuing a check or draft, in partial settlement of a loss or claim under specific coverage that
contains language that release the insurer or insured from total liability.
D. All the above - CORRECT ANSWER - D: All of the above
An act of terrorism is required to be "certified" as such by whom? - CORRECT ANSWER -
The Secretary of the Treasury
Which of the following is NOT considered an act of terrorism:
A. Act of riot and civil commotion
B. Acts considered dangerous to human life, property or infrastructure
C. Acts resulting in damage within or outside the United States
D. Acts committed at the premises of any United States mission. - CORRECT ANSWER -
Answer A: An act of riot and civil commotion
In order to be certified as an official act of terrorism under the Federal Terrorism Act, Property
and Casualty losses have to exceed $_______ for any one event: - CORRECT ANSWER -
$5,000,000
Which of the following can be covered by the Federal Terrorism Act insurance program:
A. Most commercial property and casualty risks
B. Federal crop insurance
C. Personal Insurance Policies
,D. Health and Life Insurance Policies - CORRECT ANSWER - A: Most commercial property
and casualty risks
All of the following are considered acts of rebating, except: - CORRECT ANSWER - A. An
agent provides an all-expenses paid cruise to a client and his wife in exchange for writing the
coverage on his national chain of insurance
B. An agent sends holiday greeting cards to all the clients on his mailing list
C. An adjuster receives a monthly check from an auto body repair shop for recommending the
repair shop to clients who have a claim.
D. All for these situations are considered acts of rebating.
Answer B
Under the extension of the Terrorism Risk Insurance Act the federal government will share in the
losses for a certified act of terrorism if: - CORRECT ANSWER - A. Total losses for all
insurers exceed $100 million
B. An insurer is responsible for the first 20% of losses as a deductible, and then the government
will pay 85% of remaining claim amounts
C. The total certified acts of terrorism for the program year have not exceeded $100 billion
D. All of the above
Answer D
The federal law enacted to control the ways financial institutions and insurance companies deal
with he private information of individuals is: - CORRECT ANSWER - The Gramm-Leach-
Bliley Act
The federal government sometimes provides insurance that is not ordinarily available from
private insurers. What insurance is provided by the federal government? - CORRECT
, ANSWER - Nuclear energy liability insurance, Federal flood insurance and Federal crop
insurance
No act will be certified by the Secretary as an act of terrorism under the Federal Terrorism Act if:
- CORRECT ANSWER - The losses that occur relate to life insurance
In addition to any administrative action, a person who violates the Federal Fraud and False
Statements regulation will be subject to a civil penalty of up to: - CORRECT ANSWER -
$50,000
$$ An insured carries "DP-2" coverage on a policy for $10,000 contents. He owns a canoe,
which he stores at a lake in a private non-owned garage.
Fire destroys the garage and the boat.
How much coverage will his policy provide? - CORRECT ANSWER - Nothing
An insured's home is covered by the DP-3 form. The policy provides $20,000 in coverage on a
home that would cost $50,000 to replace. When high winds destroy the roof, it is determined that
it will cost $2,000 to replace it. Assuming the actual cash value of the is $750, how much will the
insured collect for the loss? - CORRECT ANSWER - $1,000
Because the insured was underinsured (Least 80%), the policy will pay 50% of the $2,000 loss =
$1,000.
Mr. Simpson owns a dwelling in a rural area close to a small wooded area. He is covered under a
DP-3 form. A deer sees it's reflection in a picture window and jumps throught and enters the
dwelling causing significant wall and floor damage. Some of the furniture is damaged and must
be replaced. He is covered for $100,000 on the dwelling and $50,000 on the contents. Which of
the following would apply to this loss? - CORRECT ANSWER - A. The entire loss would be
denied.
B. Pay replacement cost on the dwelling and ACV for the contents loss.
ACTUAL Exam Questions and CORRECT
Answers
What is NOT a factor in establishing negligence on the insured's part? - CORRECT
ANSWER - There is a breach of protection.
One characteristic of an insurance contract is that both parties must perform certain acts to assure
that the contract is legally enforceable. This is called...? - CORRECT ANSWER - Executory
The responsibility of the federal government in the regulation of the insurance industry is limited
to what? - CORRECT ANSWER - Fair Labor Standards and Anti-trust Matters
An insurer who issues a statement that misrepresents the benefits, advantages, conditions or
terms of any insurance policy would be guilty of: - CORRECT ANSWER - Misrepresentation
and False Advertising
The insurance department has been advised that an agent is guilty of insurance code violation.
The Commissioner will: - CORRECT ANSWER - Call for a hearing
What could be considered an Unfair Trade Practice? - CORRECT ANSWER - Twisting,
Rebating, and Coercion are all Unfair Trade Practice
What is NOT considered to be an unfair claims practice? - CORRECT ANSWER - Failing to
honor an uncovered claim
Although their liability is clear, BB&S Insurance Company routinely delays all claim payments
for 90 days, and in doing so: - CORRECT ANSWER - Is guilty of unfair claim settlement
practice
Which of the following would be considered unfair or deceptive acts by an adjuster?
,A. Requesting that a first party claimant signs a release that extends beyond the subject matter
which gave rise to the claim payment.
B. Advising the claimant that their rights may be impaired if a form of release is not completed
within a specified period of time unless for the purpose of notification of statute of limitations.
C. Issuing a check or draft, in partial settlement of a loss or claim under specific coverage that
contains language that release the insurer or insured from total liability.
D. All the above - CORRECT ANSWER - D: All of the above
An act of terrorism is required to be "certified" as such by whom? - CORRECT ANSWER -
The Secretary of the Treasury
Which of the following is NOT considered an act of terrorism:
A. Act of riot and civil commotion
B. Acts considered dangerous to human life, property or infrastructure
C. Acts resulting in damage within or outside the United States
D. Acts committed at the premises of any United States mission. - CORRECT ANSWER -
Answer A: An act of riot and civil commotion
In order to be certified as an official act of terrorism under the Federal Terrorism Act, Property
and Casualty losses have to exceed $_______ for any one event: - CORRECT ANSWER -
$5,000,000
Which of the following can be covered by the Federal Terrorism Act insurance program:
A. Most commercial property and casualty risks
B. Federal crop insurance
C. Personal Insurance Policies
,D. Health and Life Insurance Policies - CORRECT ANSWER - A: Most commercial property
and casualty risks
All of the following are considered acts of rebating, except: - CORRECT ANSWER - A. An
agent provides an all-expenses paid cruise to a client and his wife in exchange for writing the
coverage on his national chain of insurance
B. An agent sends holiday greeting cards to all the clients on his mailing list
C. An adjuster receives a monthly check from an auto body repair shop for recommending the
repair shop to clients who have a claim.
D. All for these situations are considered acts of rebating.
Answer B
Under the extension of the Terrorism Risk Insurance Act the federal government will share in the
losses for a certified act of terrorism if: - CORRECT ANSWER - A. Total losses for all
insurers exceed $100 million
B. An insurer is responsible for the first 20% of losses as a deductible, and then the government
will pay 85% of remaining claim amounts
C. The total certified acts of terrorism for the program year have not exceeded $100 billion
D. All of the above
Answer D
The federal law enacted to control the ways financial institutions and insurance companies deal
with he private information of individuals is: - CORRECT ANSWER - The Gramm-Leach-
Bliley Act
The federal government sometimes provides insurance that is not ordinarily available from
private insurers. What insurance is provided by the federal government? - CORRECT
, ANSWER - Nuclear energy liability insurance, Federal flood insurance and Federal crop
insurance
No act will be certified by the Secretary as an act of terrorism under the Federal Terrorism Act if:
- CORRECT ANSWER - The losses that occur relate to life insurance
In addition to any administrative action, a person who violates the Federal Fraud and False
Statements regulation will be subject to a civil penalty of up to: - CORRECT ANSWER -
$50,000
$$ An insured carries "DP-2" coverage on a policy for $10,000 contents. He owns a canoe,
which he stores at a lake in a private non-owned garage.
Fire destroys the garage and the boat.
How much coverage will his policy provide? - CORRECT ANSWER - Nothing
An insured's home is covered by the DP-3 form. The policy provides $20,000 in coverage on a
home that would cost $50,000 to replace. When high winds destroy the roof, it is determined that
it will cost $2,000 to replace it. Assuming the actual cash value of the is $750, how much will the
insured collect for the loss? - CORRECT ANSWER - $1,000
Because the insured was underinsured (Least 80%), the policy will pay 50% of the $2,000 loss =
$1,000.
Mr. Simpson owns a dwelling in a rural area close to a small wooded area. He is covered under a
DP-3 form. A deer sees it's reflection in a picture window and jumps throught and enters the
dwelling causing significant wall and floor damage. Some of the furniture is damaged and must
be replaced. He is covered for $100,000 on the dwelling and $50,000 on the contents. Which of
the following would apply to this loss? - CORRECT ANSWER - A. The entire loss would be
denied.
B. Pay replacement cost on the dwelling and ACV for the contents loss.
