FL 6-20 Claims Adjuster Exam Questions and Answers 100%Correct

What is the Principle of Indemnity? - ANSWER-Restoration of approximate previous financial condition; no more, no less. What is a Premium? - ANSWER-A fee that the insured pays in exchange for insurance coverage. What is a Reserve? - ANSWER-A pool of collected premiums that the insurer sets aside to pay claims. Legal Contract - ANSWER- Insurance Policy - ANSWER-A contract to provide financial protection for a fee. Four Requirements of a Legal Contract - ANSWER-1. Agreement (i.e. Offer and Acceptance) 2. Consideration 3. Competent Parties 4. Legal purpose Termination of Offer - ANSWER-Offer may be terminated by: 1. Revocation by offeror 2. Rejection by offeree 3. Time lapse 4. Termination by operation of law: a. Either party does or becomes disabled b. Performance of contract becomes illegal after offer c. Subject matter is destroyed