Page 1 of 112
State Farm Estimatics Exam (Latest )
Comprehensive 350+ Qs & Ans - to Pass the Exam, 100%
Verified – UPDATED (Fire and Property) (certification - claims
adjuster) (Property and Casualty)
In property insurance actual cash value is defined as which of the following - Answer: Replacement cost
at the time of the loss, less depreciation
Peril is most easily defined as - Answer: the cause of loss insured against
What is a leading factor in the determination of actual cash value - Answer: replacement cost
Replacement cost is defined as - Answer: full replacement of property at its current cost, new and
without reduction for depreciation
Property insurance that provides 100k coverage for a building and 50k coverage for personal property at
a single location is called - Answer: Specific coverage
Which of the following is used in the formula for calculating the actual cash value of a property -
Answer: replacement cost
What is the purpose of the coinsurance clause found in property insurance policies? - Answer:
Encourage the insured to insure the property closer to its full value
An insured has a liability policy that sets the amount at 50k for all claims that arise from a single
incident. which type of limit of liability does this insured's policy have? - Answer: per occurrence
When the amount of insurance written in a property policy is not subject to any coinsurance provision
and that amount is paid in the event of a covered loss, the coverage is said to be written as - Answer:
stated amount
,Page 2 of 112
What is stated amount coverage - Answer: In stated amt coverage the value of the insured property is
determined at the time the policy is written.
in the event of a loss, that amount is paid without regard to any coinsurance provision.
However, if the loss is less than the total, the insurer has salvage rights with the insured having first right
of refusal of the salvage.
What type of liability would a person who owns a swimming pool have? - Answer: Absolute
What is absolute liability - Answer: Any conduct that is inherently dangerous imposes absolute liability.
the claimant does not have to prove anything
Insurable interest in the property covered in a policy must be proven - Answer: at the time of loss
Which of the following is NOT an element of negligence
breach, unbroken chain, libel, duty - Answer: libel
what is libel - Answer: a type of intentional tort
With respect to the business of insurance, a hazard is - Answer: any condition or exposure that increases
the possibility of loss
What are the four essential elements of all legal contracts - Answer: offer and acceptance,
consideration, competent parties, and legal purpose
In forming an insurance contract, when does acceptance usually occur? - Answer: when an insurer's
underwriter approves coverage
Who is responsible for filling out a notice of claim form - Answer: insured
,Page 3 of 112
what is a notice of claim - Answer: a form or statement from an insured to an insurer, informing the
insurer that events leading to a possible claim have occurred
If a property is covered by comp a for 20k and comp b covers the same property for 40k, how much will
comp a pay on a 24k loss? - Answer: 8000
pro rata liability applies
each policy pays a percentage of the loss based on the percentage of coverage that policy provides.
comp a carries 1/3 of the total coverage (20k + 40k = 60k)
Therefore 1/3 of the 24k loss is 8,000
In the event of a loss covered by the policy, if the insurer requests a signed sworn proof of loss, the
named insured is required to submit it within - Answer: a specified time
What are considered parts of the policy structure - Answer: conditions, exclusions, insuring clause
A homeowner sells his house to a friend. the friend wants to keep the homeowners current policy in
effect. under the assignment provision which of the following is most likely? - Answer: the homeowner
will need to get written consent from the insurer before the policy can be reassigned
What is consideration? - Answer: something of value that is transferred between the two parties to form
a legal contract
What are endorsements - Answer: change the policy's original terms, conditions, or coverages.
endorsements can add or delete coverage or merely correct items such as the insured's name and
address etc
Termination of an inforce insurance policy prior to the expiration date shown in the policy is known as -
Answer: cancellation
, Page 4 of 112
When would a misrepresentation on the insurance app be considered fraud? - Answer: if it is intentional
and material
What is true about single dwellings that are insured to at least 80% of the replacement value - Answer:
they are automatically provided with replacement cost coverage
If more than one person has an insurable interest in the property covered under a dwelling policy -
Answer: The insurer will be liable for only the insured's interest in the damaged property
Johanna purchased a national flood insurance policy 10 days after her community entered an
emergency program. when would her coverage be effective? - Answer: 1201 am the day after the
application and premium payment are mailed
a commercial property special form covers property in transit up to - Answer: 5k
when a regular bill of lading is issued, who will be responsible for the invoice cost of any damaged
property - Answer: The carrier
A person who is not named as an insured on the dec page of a policy but is protected by the policy is
known as the - Answer: additional insured
The policy conditions define - Answer: how parties to the contract must act following a loss
The part of the insurance contract that describes the covered perils and the nature of the coverage of
the contractual agreement between the insurer and the insured is called the - Answer: insuring
agreement
What is the insuring agreement - Answer: is the part of the policy structure that describes the insured
perils and the method of indemnification
Before an insurer will pay any loss under a policy, what is usually required from the insured? - Answer:
proof of loss
State Farm Estimatics Exam (Latest )
Comprehensive 350+ Qs & Ans - to Pass the Exam, 100%
Verified – UPDATED (Fire and Property) (certification - claims
adjuster) (Property and Casualty)
In property insurance actual cash value is defined as which of the following - Answer: Replacement cost
at the time of the loss, less depreciation
Peril is most easily defined as - Answer: the cause of loss insured against
What is a leading factor in the determination of actual cash value - Answer: replacement cost
Replacement cost is defined as - Answer: full replacement of property at its current cost, new and
without reduction for depreciation
Property insurance that provides 100k coverage for a building and 50k coverage for personal property at
a single location is called - Answer: Specific coverage
Which of the following is used in the formula for calculating the actual cash value of a property -
Answer: replacement cost
What is the purpose of the coinsurance clause found in property insurance policies? - Answer:
Encourage the insured to insure the property closer to its full value
An insured has a liability policy that sets the amount at 50k for all claims that arise from a single
incident. which type of limit of liability does this insured's policy have? - Answer: per occurrence
When the amount of insurance written in a property policy is not subject to any coinsurance provision
and that amount is paid in the event of a covered loss, the coverage is said to be written as - Answer:
stated amount
,Page 2 of 112
What is stated amount coverage - Answer: In stated amt coverage the value of the insured property is
determined at the time the policy is written.
in the event of a loss, that amount is paid without regard to any coinsurance provision.
However, if the loss is less than the total, the insurer has salvage rights with the insured having first right
of refusal of the salvage.
What type of liability would a person who owns a swimming pool have? - Answer: Absolute
What is absolute liability - Answer: Any conduct that is inherently dangerous imposes absolute liability.
the claimant does not have to prove anything
Insurable interest in the property covered in a policy must be proven - Answer: at the time of loss
Which of the following is NOT an element of negligence
breach, unbroken chain, libel, duty - Answer: libel
what is libel - Answer: a type of intentional tort
With respect to the business of insurance, a hazard is - Answer: any condition or exposure that increases
the possibility of loss
What are the four essential elements of all legal contracts - Answer: offer and acceptance,
consideration, competent parties, and legal purpose
In forming an insurance contract, when does acceptance usually occur? - Answer: when an insurer's
underwriter approves coverage
Who is responsible for filling out a notice of claim form - Answer: insured
,Page 3 of 112
what is a notice of claim - Answer: a form or statement from an insured to an insurer, informing the
insurer that events leading to a possible claim have occurred
If a property is covered by comp a for 20k and comp b covers the same property for 40k, how much will
comp a pay on a 24k loss? - Answer: 8000
pro rata liability applies
each policy pays a percentage of the loss based on the percentage of coverage that policy provides.
comp a carries 1/3 of the total coverage (20k + 40k = 60k)
Therefore 1/3 of the 24k loss is 8,000
In the event of a loss covered by the policy, if the insurer requests a signed sworn proof of loss, the
named insured is required to submit it within - Answer: a specified time
What are considered parts of the policy structure - Answer: conditions, exclusions, insuring clause
A homeowner sells his house to a friend. the friend wants to keep the homeowners current policy in
effect. under the assignment provision which of the following is most likely? - Answer: the homeowner
will need to get written consent from the insurer before the policy can be reassigned
What is consideration? - Answer: something of value that is transferred between the two parties to form
a legal contract
What are endorsements - Answer: change the policy's original terms, conditions, or coverages.
endorsements can add or delete coverage or merely correct items such as the insured's name and
address etc
Termination of an inforce insurance policy prior to the expiration date shown in the policy is known as -
Answer: cancellation
, Page 4 of 112
When would a misrepresentation on the insurance app be considered fraud? - Answer: if it is intentional
and material
What is true about single dwellings that are insured to at least 80% of the replacement value - Answer:
they are automatically provided with replacement cost coverage
If more than one person has an insurable interest in the property covered under a dwelling policy -
Answer: The insurer will be liable for only the insured's interest in the damaged property
Johanna purchased a national flood insurance policy 10 days after her community entered an
emergency program. when would her coverage be effective? - Answer: 1201 am the day after the
application and premium payment are mailed
a commercial property special form covers property in transit up to - Answer: 5k
when a regular bill of lading is issued, who will be responsible for the invoice cost of any damaged
property - Answer: The carrier
A person who is not named as an insured on the dec page of a policy but is protected by the policy is
known as the - Answer: additional insured
The policy conditions define - Answer: how parties to the contract must act following a loss
The part of the insurance contract that describes the covered perils and the nature of the coverage of
the contractual agreement between the insurer and the insured is called the - Answer: insuring
agreement
What is the insuring agreement - Answer: is the part of the policy structure that describes the insured
perils and the method of indemnification
Before an insurer will pay any loss under a policy, what is usually required from the insured? - Answer:
proof of loss
