ALABAMA ADJUSTERS LICENSE EXAM 2024| 370
ACTUAL EXAM QUESTIONS WITH 100% CORRECT
DETAILED ANSWERS SCORED A+
Accident Insurance < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >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) < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >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) < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >Salaried employee of one insurance company who can
work locally, regionally, or nationally. Also called:
Company Adjuster
Advance Payment
Settlement < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >Authority that is expressly given to the agent in writing. Allows
the agent to act on behalf of the principal.
Agency Authority - Implied < RIGHT ANS >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) < RIGHT ANS >Someone who has received authority from an insurer
to sell or service insurance policies.
Agreed Value < RIGHT ANS >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 < RIGHT ANS >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 < RIGHT ANS >A business that grows, harvests, and sells crops for
profit.
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