USAA Licensing Exam Questions With Correct Answers

USAA Licensing Exam Questions With
Correct Answers

Insurance |- |CORRECT |ANSWER✔✔-Transfer |of |risk |from |one |person |or |organization |to |an |
insurance |company



Indemnity |- |CORRECT |ANSWER✔✔-The |principle |to |restore |the |insured |to |the |pre-loss |
economic |or |financial |condition.



Law |of |Large |numbers |- |CORRECT |ANSWER✔✔-Mathematical |principle |used |by |insurers |to |
predict |losses |to |charge |the |appropriate |premiums



Insurable |Interest |- |CORRECT |ANSWER✔✔-Proof |that |someone |stands |to |lose |financially |if |a |
loss |occurs; |must |exist |at |the |time |of |the |loss |in |property |and |casualty |insurance



Binder |- |CORRECT |ANSWER✔✔-Temporary |insurance |contract; |commits |the |company |to |act |as
|if |a |policy |has |been |issued




Peril |- |CORRECT |ANSWER✔✔-Cause |of |loss



Direct |Loss |- |CORRECT |ANSWER✔✔-Immediate |actual |physical |damage |to |tangible |property



Indirect |loss |- |CORRECT |ANSWER✔✔-Inability |to |use |property |as |a |result |of |a |direct |loss



Risk |- |CORRECT |ANSWER✔✔-Chance |of |loss; |uncertainty |of |loss

,What |are |the |two |types |of |risk? |- |CORRECT |ANSWER✔✔-Speculative |and |Pure



Speculative |Risk |- |CORRECT |ANSWER✔✔-Involves |the |simultaneous |chance |of |gain |or |loss: |is |
not |insurable



Pure |Risk |- |CORRECT |ANSWER✔✔-a |risk |that |presents |the |chance |of |loss |but |no |opportunity |
for |gain |(insurable)



What |are |two |examples |of |speculative |risk? |- |CORRECT |ANSWER✔✔-Gambling

Investing



What |is |an |example |of |your |risk? |- |CORRECT |ANSWER✔✔-Car |accident



Physical |hazards |include |- |CORRECT |ANSWER✔✔-Visible |condition |that |increases |the |chance |
of |loss



Morale |Hazard |- |CORRECT |ANSWER✔✔-Attitude |of |carelessness |or |indifference |to |loss



Insurer |- |CORRECT |ANSWER✔✔-The |insurance |company |(a.k.a. |second |party |to |the |contract)



Named |Insured |- |CORRECT |ANSWER✔✔-A |party |named |on |the |declarations |who |is |purchasing
|the |insurance |policy |(a.k.a. |first |party |to |the |contract)




Insured |- |CORRECT |ANSWER✔✔-Who |the |insurer |promises |to |protect |in |addition |to |the |
named |insured



Limit |of |Liability |- |CORRECT |ANSWER✔✔-The |maximum |amount |that |can |be |paid |for |a |
covered |loss

,Consideration |- |CORRECT |ANSWER✔✔-An |exchange |of |value |between |parties |to |a |contract



Waiver |- |CORRECT |ANSWER✔✔-The |voluntary |relinquishment |of |a |known |right



What |is |Estopple? |- |CORRECT |ANSWER✔✔-When |an |agent |tells |an |insured/makes |the |
statement |there |is |coverage |for |a |loss |when |there |is |no |such |coverage, |then |the |insurer |is |
prevented |from |denying |the |claim |as |a |result |of |what |precedent?



Concealment |- |CORRECT |ANSWER✔✔-Insured |or |prospect |deliberately |withholding |material |
information |from |the |insurer, |this |voids |coverage



Material |Misrepresentation |- |CORRECT |ANSWER✔✔-Insured |or |prospect |giving |incorrect |
material |information |to |the |insurer, |this |voids |coverage



Warranty |- |CORRECT |ANSWER✔✔-A |written |condition |in |the |policy |that |must |be |true |at |the |
time |of |the |loss



Texas |Department |of |Insurance |- |CORRECT |ANSWER✔✔-In |Texas, |the |insurance |industry |is |
regulated |by |the



Commissioner |- |CORRECT |ANSWER✔✔-The |(_______) |is |appointed |by |the |governor |and |heads
|the |Texas |Department |of |Insurance




Adjuster |- |CORRECT |ANSWER✔✔-According |to |the |Texas |Insurance |Code, |any |person |who |
investigates |or |adjusts |losses, |or |any |person |who |supervises |the |handling |of |claims |must |be |
licensed |as |an |(_______________)

, A |Staff |Adjuster |- |CORRECT |ANSWER✔✔-A |(_____) |is |on |the |payroll |of |an |insurance |company |
and |is |paid |a |salary |or |by |the |hour



Independent |Adjuster |- |CORRECT |ANSWER✔✔-A |(___) |handles |claims |for |one |or |more |
insurance |companies |and |receives |a |fee |based |on |time |and |expense.



Public |Adjuster |- |CORRECT |ANSWER✔✔-A |(__) |works |on |behalf |of |the |insured |in |negotiating |a
|claim |settlement. |In |Texas |a |(______) |requires |another |separate |license |called |a |"public |


adjusters |license".



Insurance |Agent |- |CORRECT |ANSWER✔✔-Persons |marketing |(Selling) |insurance |products |are |
called |(___)



Alien |Insurer |- |CORRECT |ANSWER✔✔-An |insurer |organized |and |domiciled |outside |the |United |
States |is |called |an |(_____)



Domestic |Insurer |- |CORRECT |ANSWER✔✔-An |insurer |organized, |admitted, |and |writing |
insurance |in |Texas |is |called |a |(______)



A |Foreign |Insurer |- |CORRECT |ANSWER✔✔-An |insurer |domiciled |outside |the |state |where |she |
writes |business |is |called |a |(____)



Unfair |Claim |Settlement |- |CORRECT |ANSWER✔✔-An |adjuster |intentionally |lowballs |the |claim |
settlement |by |offering |less |than |the |amount |owed |to |the |insured



Unfair |Claim |Settlement |Practices |Act |- |CORRECT |ANSWER✔✔-An |Agent |collects |a |premium |
for |a |policy, |but |does |not |send |it |to |the |company |and |allows |a |policy |to |be |canceled



Unfair |Claims |Settlement |Practices |Act |- |CORRECT |ANSWER✔✔-The |insurance |company |fails |
to |adopt |reasonable |standards |for |processing |claims