Texas All-Lines Adjuster Pre-Licensing
Questions And Answers 100% Verified.
Chapter 1 - correct answer.
insurance - correct answer. financial took that protects individual and organizations
from unforeseen and extraordinary financial losses by transferring risk to another party
insured - correct answer. individual or organization that pays premiums in exchange
for protection
insurer - correct answer. company, group, or government agency offering financial
protection
how does insurance work? - correct answer. insured pays premium
insurer promises to pay for specific losses if they occur
insurer's promise gives peace of mind to insured
principle of indemnity - correct answer. when a loss occurs, an individual should be
restored to the approximate financial condition he was in before the loss, no more and
no less
Q1: How can insurance companies afford to pay for an individual's catastrophic loss? -
correct answer.
Q1: The purpose of the principle of indemnity: - correct answer. prevents an insured
from profiting from a loss
,Q1: Which of the following best defines premium? - correct answer. the fee paid by
the insured in exchange for the insurance policy
Q1: What best describes insurance? - correct answer. an economic device used to
protect against the risk of unforeseen and extraordinary financial loss
Q1: Mark incurred $8000 damage to his car in an accident. He received $8000 from his
insurance company and $4000 from the other driver. By receiving profit from his loss,
Mark could be in violation of: - correct answer. the principle of indemnity
he should be in the same financial condition. no better, no worse
indemnification may include payment for: - correct answer. repairs to property
reimbursement for additional living expenses
rental cars, hotels
costs directly associated with a loss, as allowed under the policy
legal contract/insurance policy is: - correct answer. contract to provide financial
protection for a fee
legally binding because it meets the 4 requirements of a legal contract
What are the 4 requirements of a legal contract? - correct answer. agreement (offer
and acceptance)
consideration
competent parties
legal purpose
agreement - correct answer. mutual consent between offeror and offeree
acceptance criteria - correct answer. offeree communicates to the offeror his intent to
enter into contract
must be unconditional - the offeree accepts the terms proposed by the offeror
original offeree is the only person who can legally accept the offer
An offer may be terminated by: - correct answer. revocation by offeror
rejection by offeree
, time lapse
termination by operation of law
-either party dies or becomes disabled
-performance of contract becomes illegal after the offer
-subject matter is destroyed
offer rejection - correct answer. explicit rejection
proposal of new offer
counteroffer
consideration - correct answer. all parties bring something of value
competent parties - correct answer. 18 years old, sober, and sane
legal purpose - correct answer. no contracts for money laundering
Q2: An offeree may legally reject a contract offer by any of the following means
EXCEPT: - correct answer. asking for clarification or additional information
Q2: If covered by an insurance policy, an insured may be indemnified for all of the
following except: - correct answer. home remodels
Q2: Which of the following is NOT a requirement for a legally binding contract? - correct
answer. it must be a notarized document
Q2: Which of the following refers to being restored to the financial condition you were in
before a loss? - correct answer. indemnification
Q2: A legally binding contract is where the risk of financial loss is transferred in
exchange for premiums is called: - correct answer. an insurance policy
1-A: The purpose of the principle of indemnity is: - correct answer. to prevent and
insured from making a profit on a loss
1-A: Which of the following best defines premium? - correct answer. the fee paid by
the insured in exchange for an insurance policy
1-A: What is a reserve, in insurance terms? - correct answer. a pool of collected
premiums that the insurer sets aside to pay claims
1-A: Which of the following refers to being restored to the financial condition you were in
before a loss? - correct answer. indemnification
Questions And Answers 100% Verified.
Chapter 1 - correct answer.
insurance - correct answer. financial took that protects individual and organizations
from unforeseen and extraordinary financial losses by transferring risk to another party
insured - correct answer. individual or organization that pays premiums in exchange
for protection
insurer - correct answer. company, group, or government agency offering financial
protection
how does insurance work? - correct answer. insured pays premium
insurer promises to pay for specific losses if they occur
insurer's promise gives peace of mind to insured
principle of indemnity - correct answer. when a loss occurs, an individual should be
restored to the approximate financial condition he was in before the loss, no more and
no less
Q1: How can insurance companies afford to pay for an individual's catastrophic loss? -
correct answer.
Q1: The purpose of the principle of indemnity: - correct answer. prevents an insured
from profiting from a loss
,Q1: Which of the following best defines premium? - correct answer. the fee paid by
the insured in exchange for the insurance policy
Q1: What best describes insurance? - correct answer. an economic device used to
protect against the risk of unforeseen and extraordinary financial loss
Q1: Mark incurred $8000 damage to his car in an accident. He received $8000 from his
insurance company and $4000 from the other driver. By receiving profit from his loss,
Mark could be in violation of: - correct answer. the principle of indemnity
he should be in the same financial condition. no better, no worse
indemnification may include payment for: - correct answer. repairs to property
reimbursement for additional living expenses
rental cars, hotels
costs directly associated with a loss, as allowed under the policy
legal contract/insurance policy is: - correct answer. contract to provide financial
protection for a fee
legally binding because it meets the 4 requirements of a legal contract
What are the 4 requirements of a legal contract? - correct answer. agreement (offer
and acceptance)
consideration
competent parties
legal purpose
agreement - correct answer. mutual consent between offeror and offeree
acceptance criteria - correct answer. offeree communicates to the offeror his intent to
enter into contract
must be unconditional - the offeree accepts the terms proposed by the offeror
original offeree is the only person who can legally accept the offer
An offer may be terminated by: - correct answer. revocation by offeror
rejection by offeree
, time lapse
termination by operation of law
-either party dies or becomes disabled
-performance of contract becomes illegal after the offer
-subject matter is destroyed
offer rejection - correct answer. explicit rejection
proposal of new offer
counteroffer
consideration - correct answer. all parties bring something of value
competent parties - correct answer. 18 years old, sober, and sane
legal purpose - correct answer. no contracts for money laundering
Q2: An offeree may legally reject a contract offer by any of the following means
EXCEPT: - correct answer. asking for clarification or additional information
Q2: If covered by an insurance policy, an insured may be indemnified for all of the
following except: - correct answer. home remodels
Q2: Which of the following is NOT a requirement for a legally binding contract? - correct
answer. it must be a notarized document
Q2: Which of the following refers to being restored to the financial condition you were in
before a loss? - correct answer. indemnification
Q2: A legally binding contract is where the risk of financial loss is transferred in
exchange for premiums is called: - correct answer. an insurance policy
1-A: The purpose of the principle of indemnity is: - correct answer. to prevent and
insured from making a profit on a loss
1-A: Which of the following best defines premium? - correct answer. the fee paid by
the insured in exchange for an insurance policy
1-A: What is a reserve, in insurance terms? - correct answer. a pool of collected
premiums that the insurer sets aside to pay claims
1-A: Which of the following refers to being restored to the financial condition you were in
before a loss? - correct answer. indemnification
