Exam (elaborations)
ADJUSTER PRO PRACTICE EXAM QUESTIONS AND ANSWERS
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ADJUSTER PRO PRACTICE EXAM QUESTIONS AND ANSWERS
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ADJUSTER PRO PRACTICE EXAMQUESTIONS AND ANSWERS
Stu6has6a6collection6of6rare6comic6books.6He6wants6to6purchase6theft6insurance6for6his
collection,6separate6from6his6home6and6other6property.6What6term6most6accurately
describes6the6type6of6policy6Stu6would6purchase?6-6ans--Monoline6Policy
Which6of6the6following6statements6does6NOT6apply6to6the6Standard6Fire6Policy?6-6ans--
It6automatically6covers6wind6and6vandalism.
Which6of6the6following6refers6to6being6restored6to6the6financial6condition6you6were6in
before6a6loss?6-6ans--Indemnification
The6fee6paid6by6the6insured6in6exchange6for6an6insurance6policy6is6called6a:6-6ans--
premium
Haley6takes6a6bottle6of6water6into6a6store,6pours6some6of6it6on6the6floor6when6no6one6is
looking,6and6then6pretends6to6slip6and6fall.6She6cries6out6for6help6in6apparent6pain
until6someone6comes6to6her6aid.6She6then6sues6the6store6for6her6fake6injury6in6an
effort6to6collect6an6insurance6settlement.6What6has6Haley6committed?6-6ans--Hard6fraud
Which6settlement6option6is6most6often6used6when6a6claimant6misses6work6because6of
bodily6injury,6but6a6settlement6has6not6yet6been6reached?6-6ans--
Advance6payment6settlement
Cindy6and6her6insurer6cannot6reach6an6agreement6for6her6property6claim,6and6have
gone6back6and6forth6for6weeks6without6coming6within6$10,0006of6each6other.6At6this
point,6since6both6believe6they6are6offering6a6fair6settlement,6a6third6party6is6needed6to
help6facilitate6the6negotiation.6Both6parties6still6want6to6retain6their6ability6to6"walkaway"6if
6they6cannot6reach6an6agreement.6What6is6the6next6best6step6for6Cindy6and6her6insurer?
6-6ans--Mediation
When6Jeanette6shows6up6to6handle6a6claim6on6behalf6of6ABC6Insurance,6she6evaluates
the6claim6and6negotiates6a6settlement.6Maintaining6her6integrity6and6acting6ethically,
Jeanette6is6fulfilling6her:6-6ans--fiduciary6duty.
Many6adjusters6prefer6arbitration6to6litigation,6because6professional6arbitrators6tend6to
,be6more6___________6than6civil6juries.6-6ans--knowledgeable
Which6of6the6following6is6NOT6true6of6the6no-release6settlement?6-6ans--
It's6also6called6an6"advance6payment6settlement."
Why6should6litigation6be6considered6a6last6resort6option?6-6ans--
It6can6be6costly6and6unpredictable
Which6of6the6following6steps6would6occur6LAST6in6the6processing6of6a6claim?6-6ans--
Negotiate6a6settlement6with6the6claimant
As6an6adjuster6for6KLM6Insurance,6Chrystal6has6the6important6role6of6fiduciary6agent.
While6acting6in6this6capacity,6Chrystal's6primary6responsibility6is6to:6-6ans--
protect6the6financial6and6property6interests6of6KLM6Insurance
Bobby6is6adjusting6a6complicated6auto6claim.6Which6of6the6following6is6TRUE?6-6ans--
Because6the6policyholder6(Jane)6is6846years6old6and6seems6to6have6trouble6rememberin
g6what
happened6before6the6accident,6Bobby6should6feel6free6to6contact6her645-year-
old6caretaker6for
clarification.
Jim6is6an6insurance6adjuster6working6a6theft6claim.6As6part6of6his6investigation,6Jim
might6want6to6do6all6of6the6following,6EXCEPT:6-6ans--
look6for6ways6to6lower6the6settlement6for6the6claimant.
Adjuster6Alice6is6trying6to6determine6the6final6settlement6amount6for6Ted's6claim.6Ted's
house6was6damaged6in6a6covered6loss,6and6Alice6has6estimated6that6it6will6cost
$25,0006to6make6the6necessary6repairs.6Ted's6homeowners6policy6has6a6$100,0006limit
and6a6$2,0006deductible.6Typically,6how6much6would6Adjuster6Alice6calculate6Ted's
final6settlement6amount6to6be?6-6ans--$23,000
As6an6insurance6adjuster,6Heather6is6responsible6for6updating6and6maintaining6an
accurate6record6of6all6the6information6pertinent6to6an6individual's6insurance6claim,
including6copies6of6all6written6documentation,6photos6and6property6sketches,6witness
statements,6and6copies6of6medical6bills.6What6is6this6record6called?6-6ans--Claim6file
Bill6is6going6to6switch6employers,6and6therefore6switch6healthcare6providers.6Which
federal6law6ensures6that6he6won't6be6denied6coverage6when6he6switches6health6plans?6-
6ans--HIPAA
Cindy,6a6drunk6driver,6accidentally6crashes6into6Nancy's6house,6causing6$22,0006in
damage.6On6top6of6that,6Nancy6tries6to6get6the6adjuster6to6add6an6additional6$20,000
for6punitive6damages6to6punish6Cindy6for6driving6while6intoxicated.6However,6Nancy
fails6in6her6attempts6at6negotiation.6This6is6because:6-6ans--
the6adjuster6does6not6have6authority6to6negotiate6for6punitive6damages.
, Bill's6new6home6is6in6the6final6stages6of6construction,6and6he6has6purchased6an6HO-2
policy6to6insure6his6financial6interest6in6the6property.6This6morning,6Bill's6contractor
calls6to6tell6him6that6an6electrical6fire6has6destroyed6his6new6kitchen,6and6all6of6the
crown6molding6that6was6supposed6to6be6installed6today6has6been6stolen.6It6will6be
$15,0006to6rebuild6the6kitchen6and6another6$4,2006to6replace6the6trim.6How6will6Bill's
insurer6respond6when6he6files6a6claim?6-6ans--
His6insurer6will6pay6$15,0006to6rebuild6the6kitchen6and6nothing6for6the6stolen6trim.
Tim's6$2,5006boat6trailer6was6stolen6from6his6driveway.6Ignoring6any6deductibles,6how
much6can6Tim6receive6for6his6stolen6trailer6when6he6files6a6claim6against6his
homeowners6policy?6-6ans--$1,500
For6loss6settlement6purposes,6most6homeowners6policies:6-6ans--
pay6for6damages6to6personal6property6at6actual6cash6value,6and6damages6to6structures6
at6replacement
cost.
After6a6rain6storm,6Nancy6realizes6that6she6left6her6bedroom6windows6open6the6entire
time.6Now6there6is6extensive6water6damage6to6her6area6rug6and6furniture,6and6the
laptop6that6had6been6sitting6on6her6desk6is6ruined.6Nancy6has6a6Broad6Form
homeowners6policy,6so6she6calls6her6insurance6company6and6files6a6claim.6What6is
the6likely6result6of6Nancy's6claim?6-6ans--
The6insurer6will6not6cover6any6of6the6damage,6since6Nancy6left6the6windows6open.
Sherrie's6roof6and6fence6are6damaged6in6a6violent6windstorm.6Sherrie6has6a6typical
HO-36policy6with6a6$150,0006limit6for6Coverage6A6-6Dwelling.6Assuming6she6has6no
endorsements,6how6much6coverage6does6she6have6available6for6the6damage6to6her
fence?6-6ans--$15,000
Phil6heads6over6to6visit6his6friend6Josh,6who6is6sick6with6the6flu.6While6at6the6house,
Josh6fails6to6cover6his6mouth6when6he6coughs6and6Phil6ends6up6contacting6the6flu.
Phil6files6a6claim6with6Josh's6insurer6for6medical6expenses6and6lost6income6while6Phil
is6out6sick6from6work.6The6insurer6denies6the6claim6because:6-6ans--
disease6transmitted6from6the6insured6to6a6third6party6is6excluded.
Mark6is6on6vacation6in6Italy6when6his6luggage6is6stolen,6including6a6$2,0006laptop,6a
$5006suitcase,6and6$4006in6clothes.6Mark6has6an6HO-36homeowners6policy.6Excluding
any6applicable6deductible,6which6of6the6following6statements6is6TRUE?6-6ans--
Mark's6homeowners6policy6will6cover6$2,4006of6this6loss.
Which6of6the6following6losses6may6qualify6for6coverage6under6Coverage6F6-6Medical
Payments?6-6ans--
Kevin6accidentally6shoots6himself6in6the6foot6with6a6nail6gun6while6he6is6helping6Joe6build
6a6deck6in
Joe's6backyard.
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