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Adjusterpro Final Exam Questions And Answers With Verified Solutions Latest Updated 2024
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Adjusterpro Final Exam Questions And Answers With Verified Solutions Latest Updated 2024
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Adjusterpro Final Exam Questions AndAnswers With Verified Solutions Latest
Updated 2024
-+What is a reserve, in insurance terms? - ANSWER✔✔ A pool of collected
premiums that the insurer sets aside to pay claims
Which of these scenarios is NOT an example of indemnification? - ANSWER✔✔
When trying to renew her dog's license, Ellen has to pay a penalty to the city for
letting its rabies vaccination lapse.
Ellen having to pay a fine is not an example of indemnification. Indemnification
means being restored to the financial condition you were in before a loss. In three
of these situations, someone experienced a loss and was then "made whole": Joe-
Bob's neighbor lost his TV, Alice lost her house, and Hugh lost the use of his car.
But in the case of Ellen's dog, the city did not experience a loss; it simply imposed
a penalty to teach Ellen a lesson about keeping up with her dog's shots.
Greg plays trombone in his school band during football games. During a rally song
in the stands one day, Greg annoys one of the opposing team's fans, who grabs his
$400 trombone and hurls it down the bleachers, completely destroying it. Greg's
insurance pays him $400 to replace the trombone, but then the opposing team's
coach also offers to replace the instrument, at whatever the cost. So Greg orders a
new $3,200 trombone and has the opposing team's athletic department absorb the
cost. Which principle has Greg violated? - ANSWER✔✔ The principle of
indemnity
Which of the following statements is true about an insurance policy? -
ANSWER✔✔ It relies on the utmost good faith of both the insured and the insurer
An insurance policy relies on the utmost good faith of both the insured and the
insurer.
,Which of the following would you find in the Conditions section of an insurance
policy? - ANSWER✔✔ The insured's duty after a loss
In which section of an insurance policy might you find the following statement?
"Damage to insured property must be reported within 15 days of the damaging
occurrence." - ANSWER✔✔ Conditions
A captive insurance company: - ANSWER✔✔ exists solely to provide insurance
for its parent company.
Cindy holds an insurance policy from Sine Nomine Insurance. This is not a
publicly traded company, and Cindy can participate in the election of the board,
receiving dividends if the company does well. Sine Nomine Insurance could be
best described as a: - ANSWER✔✔ Sine Nomine Insurance is a mutual insurance
company.
When an insurer issues an insurance policy, the actual item, person, or organization
that is being insured is called the: - ANSWER✔✔ risk.
Which of the following is a hazard? - ANSWER✔✔ A driver's tendency to text
while driving
Which of the following situations does NOT involve an insurable risk? -
ANSWER✔✔ Dale just bought 30 shares of a hot new startup company online.
Which of the following situations does NOT involve an instance of "pure risk?" -
ANSWER✔✔ Loss of money invested in the stock market
Which of the following is an insurable risk? - ANSWER✔✔ football stadium
, Risk avoidance is a risk management technique that: - ANSWER✔✔ eliminates
risk.
Amy needs more floor space in her antique furniture store, so she buys a storage
building 3 miles away. She is worried about keeping the furniture in the storage
building safe, so she puts in an alarm system and smoke detectors. By purchasing
the alarm system and smoke detectors, Amy is practicing: - ANSWER✔✔ risk
reduction.
Six Stars Development Company has just been offered a great deal on ten large
properties in Las Vegas. The economy in Las Vegas has been declining recently,
but the CEO of Six Stars expects it to recover soon. This could be an exceptional
opportunity for Six Stars, but it's also pretty risky. Ultimately, the Six Stars
executive team decides not to purchase the properties. This is an example of: -
ANSWER✔✔ risk avoidance.
Jason's auto policy states that the insurer may cancel coverage if a premium is
more than 30 days late. However, Jason is currently more than 30 days late, and
has been so five times in the last year, and his insurer has done nothing about it.
When Jason gets into an accident and files a claim, which of the following is most
likely to happen? - ANSWER✔✔ An implied waiver is one that is assumed based
on someone's actions. When the insurer decided to accept Jason's late premium
payments, it implied that it was waiving its right to cancel Jason's policy because
of a late payment. So, when Jason files a claim, the insurer may not claim that his
policy is void due to late payments.
In order to qualify for an insurance policy, Lydia's Fine Jewels must agree to have
a security guard on the premises 24/7. This is called a: - ANSWER✔✔ A warranty
is a guarantee that certain conditions will be met. If the policyholder violates a
warranty, the insurer can void the policy.
Which of the following is an example of a moral hazard? - ANSWER✔✔ Ken
lights a candle, sets it right next to the window draperies and leaves the house to go
to work.
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