Alabama Insurance adjuster exam study guide Exam with
129questions and answers 100%Correctly verified answers
latest update 2024/2025 RATED A+
Which of the following best defines premium? - CORRECT ANSWERS
Under an insurance contract, the insured pays a scheduled and
affordable fee, called a premium. In return, the insurer promises to
pay for specified losses if they occur.
What are the four requirements of a legally binding contract? -
CORRECT ANSWERS agreement, consideration, competent
parties, and legal purpose.
Melinda's home sustained $6,500 in damage when Jared ran into it
with is truck. Melinda received $6,500 from her insurance company,
and Jared also paid her $5,000. Melinda has now profited from this
loss and is in violation of: - CORRECT ANSWERS The principle of
indemnity.
An insurance policy's declarations page contains all of the following,
except: - CORRECT ANSWERS The declarations page is always the
first page or section of an insurance policy. It gives a general
overview of the policy and will include at least 8 details: the names
of both parties, the insurer and the insured; the policy number; the
location and description of the insured item; the value and
replacement value of the insured item; the dates that policy
coverage starts and ends (known as the inception and expiration
dates); the amount and limit of insurance coverage; the deductibles
on the policy; and the premium that the insured has to pay.
,Alabama Insurance adjuster exam study guide Exam with
129questions and answers 100%Correctly verified answers
latest update 2024/2025 RATED A+
All of the following pieces of information can be found in the
Conditions section of an insurance policy, except: - CORRECT
ANSWERS conditions section. This is where the policy
establishes a set of conditions that the insured must meet in order
for the policy to be valid. If the policyholder does not meet the
conditions listed here, the insurer has a right to deny coverage. For
example, if a jewelry store owner wants to purchase an insurance
policy, the conditions section may require that a security guard be
present whenever the store is open. Other conditions require a
claimant to protect damaged property from further losses, and that
the claimant must submit a proof of loss if the insurer requests it.
The insured must also cooperate with the insurer during any
investigations or lawsuits. These and other conditions are found in
the conditions section of the policy.
Janelle is happy with most of the coverage in her Homeowners
policy, but she wants to change her coverage for personal property
from ACV to Replacement Cost. She visits her local insurance agent
and asks him to make this change to her policy while keeping all the
other details the same. Which section of her policy would the agent
use to make this change? - CORRECT ANSWERS Endorsements.
often the last section of an insurance contract. Like the definitions,
this section is optional but very common. An endorsement is a
provision that modifies the coverage of the original contract. It can
add or subtract coverage for people, property, or causes of loss.
,Alabama Insurance adjuster exam study guide Exam with
129questions and answers 100%Correctly verified answers
latest update 2024/2025 RATED A+
Mark belongs to a non-profit organization that engages in charitable
activities and provides Mark with death and disability insurance
coverage. To what kind of organization does Mark likely belong? -
CORRECT ANSWERS Fraternal Benefit Societies, or Fraternal
Associations, are non-profit, mutual aid organizations that engage
primarily in charitable or benevolent activities. They offer their
members insuranceagainst death, disease, and disability. Members
of Fraternal Benefit Societies usually share common interests, such
as religion, occupation, or ethnic background. The Elks, the Masons,
The Catholic Aid Association, and Sons of Norway are all examples of
fraternal benefit societies.
A non-profit group of people or organizations that insure each other
is called a: - CORRECT ANSWERS Risk Retention Groups: Groups
where the members insure each other, using their own capital to
write insurance policies.
A "binder" is: - CORRECT ANSWERS A binder is a statement
providing immediate insurance coverage for a short period. The
binder can be oral or written, and it is meant to give temporary
protection until the final contract is drawn up, or until the insurer
decides against issuing a written policy.
Which of the following situations does NOT contain an insurable
risk? - CORRECT ANSWERS risk is an item, person, or
organization that has been insured. But not everything is insurable.
, Alabama Insurance adjuster exam study guide Exam with
129questions and answers 100%Correctly verified answers
latest update 2024/2025 RATED A+
First determine insurable risk is whether the insurer can collect
enough income from premiums to cover its two major expenses:
claims against policies and the operating costs. Second determining
whether a risk is insurable is threefold. The insurer must be able to
define the exact conditions of coverage, must know the precise
dollar value of the risk, and must be able to clearly set out the terms
under which a claim would be paid. insurable risk is that a loss must
be unpredictable and caused by circumstances no one could
reasonably prevent-a roof blown off in a tornado, a car accident, a
third condition of insurable risk is that a loss must be unpredictable
and caused by circumstances no one could reasonably prevent-a
roof blown off in a tornado, a car accident, a theft, or a fire caused by
lightning. Fourth condition of insurable risk is that the loss must
cause substantial economic hardship., Fifth condition for
determining insurable risk is that an insurer must be able to exclude
coverage for some disasters considered significantly catastrophic.,
Sixth and final qualification of an insurable risk is that an insurer
must be able to cover a large number of similar risks.,
Dale just bought 30 shares of a hot new startup company online.
An insurance company may consider each of the following a risk,
except: - CORRECT ANSWERS a school bus.
