ALABAMA ADJUSTERS LICENSE EXAM 2024| 370 ACTUAL EXAM QUESTIONS AND CORRECT DETAILED ANSWERS

ALABAMA ADJUSTERS LICENSE EXAM 2024| 370 ACTUAL EXAM QUESTIONS AND CORRECT DETAILED ANSWERS Accident Insurance - ANSWER>> Covers expenses associated with a covered accident and can extend to ambulance and emergency room expenses, intensive care, and hospital costs. Accident insurance also provides for loss of income, and a death benefit if injuries prove fatal Accumulated Depreciation - ANSWER>> The total decrease in an item's value over a period of time. Formula: (annual depreciation x number of years used). Subtract this number from the item's replacement cost to get its actual cash value (ACV). Acreage Reporting Date - ANSWER>> In crop insurance, the deadline for providing the insurer with an acreage report, which is used to determine the amount of coverage needed and the premium charged for a particular crop. Actual Cash Value (ACV) - ANSWER>> A valuation method used by insurers to reflect an item's current market value right before being damaged or destroyed. Formula: (replacement cost - accumulated depreciation) Actual Production History - ANSWER>> A history of a farmer's crop yields over a multi - year period, which is used to determine the normal production level of a farm. Adhesion - ANSWER>> Characteristic of an insurance contract. Means that one party (the insurer) sets the terms, and the other (the policyholder) can "take it or leave it. Adjusted Gross Revenue (Crop Insurance) - ANSWER>> Narrowest (and least expensive) form of crop revenue insurance. Insures farm revenue as a whole instead of individual crops. Guarantees a percentage of the insured farm's average revenue. Adjuster - ANSWER>> An agent who, for compensation, processes insurance claims. The adjuster investigates the damages, evaluates the claim, and makes a fair and equitable settlement based on the insurance contract. Can represent either the insured or the insurer. Adjuster - Emergency - ANSWER>>Adjusters who are temporarily licensed by the insurance commissioner to handle claims during catastrophes or emergencies that produce an overwhelming number of claims in a short period of time. Adjuster - Independent - ANSWER>> Self-employed adjusters who contract with multiple insurers at the same time. Paid on a commission or fee-plus-expenses basis for each claim. Also called: Fee Adjuster, Bureau Adjuster . Adjuster - Public - ANSWER>>An adjuster who is hired to represent the claimant and help determine a fair indemnification. Usually specializes in appraisals and negotiation. Paid commission, usually a percentage of final settlement. Adjuster - Staff - ANSWER>> Salaried employee of one insurance company who can work locally, regionally, or nationally. Also called: Company Adjuster Advance Payment Settlement - ANSWER>> A settlement option that lets the insurer offer some financial relief to the claimant before the claim has been fully settled. The insurer makes advance payments to the claimant, which are then subtracted from the final settlement amount. Often used when a claimant suffers bodily injury and is unable to work. Agency Authority - ANSWER>> The agent's authority to act on behalf of someone else (the principal), usually an insurer. This authority is derived from the agent's contract with the principal. It can be apparent, express, or implied Agency Authority - Apparent - ANSWER>> Indirect authority that the agent can reasonably be assumed to have, based on appearances. If an adjuster is equipped to represent an insurer (with the insurer's permission), then an individual can assume that the adjuster has the authority to act on the insurer's behalf. Agency Authority - Express - ANSWER>> Authority that is expressly given to the agent in writing. Allows the agent to act on behalf of the principal. Agency Authority - Implied - ANSWER>> Authority that an agent possesses by implication of her behavior, regardless of whether this authority is granted in writing. For example, a person portraying herself as a representative for an insurance company, even though she is not employed by that company. Agent (Insurance) - ANSWER>> Someone who has received authority from an insurer to sell or service insurance policies. Agreed Value - ANSWER>>A valued policy in which the insurer and the insured agree to a specific value for an item, appraised at the inception of the policy. Often used to insure items whose value is difficult to quantify, such as antiques or fine art. Also called a Guaranteed Value policy. Agreement - ANSWER>>One of the four requirements of a legally binding contract. All parties involved must agree to the terms of the contract. Can also refer to a binder, which is the preliminary substance of a contract. Agricultural Producer - ANSWER>>A business that grows, harvests, and sells crops for profit.