California Claims Adjusters State Certification- Complete Study Guide *Q&A* (100% Correct) 2025/2026 |VERIFIED|
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Course
California claims adjuster
Institution
California Claims Adjuster
California Claims Adjusters State
Certification- Complete Study Guide *Q&A*
(100% Correct) 2025/2026 |VERIFIED|
An agreement in which one party transfers the financial burden of potential loss to another party is
called?
Insurance
In an insurance policy, what does the policyholder pro...
California Claims Adjusters State
Certification- Complete Study Guide *Q&A*
(100% Correct) 2025/2026 |VERIFIED|
An agreement in which one party transfers the financial burden of potential loss to another party is
called?
Insurance
In an insurance policy, what does the policyholder provide in exchange for protection, and what does the
insurer promise to offer?
The policyholder pays premiums, and the insurer offers coverage against specified risks.
What is the function of insurance in terms of risk management?
It transfers the risk from one party to another.
Which insurance principle ensures that a claimant does not profit from a loss?
The principle of indemnity.
What best describes an individual or entity that enters into an insurance agreement for financial
coverage?
An insured.
Identify the four essential elements of a contract that make it legally binding.
Agreement, consideration, competent parties, and legal purpose.
If a person receives more compensation from insurance than the actual amount of their loss, they violate
which insurance principle?
The principle of indemnity.
1
,When negotiating an insurance contract, what are considered as the two forms of consideration
exchanged?
Premium payments from the insured and a promise to provide coverage from the insurer.
What happens if a party in an accident attempts to settle out of pocket to avoid involving their insurance
but a claim is filed anyway?
The insurance principle of indemnity may be violated if double compensation occurs.
Which of the following is false about insurance coverage limits?
The insurer will only pay up to the total amount of premiums collected for each insured.
Why might a claimant profit from a total loss if the insurance policy limit exceeds the value of the
insured property?
This situation contradicts insurance norms that prevent profiting from losses.
What is NOT one of the key conditions for an offer's acceptance to result in a legally binding contract?
The offeree must have no more than one stipulation.
Where would you find a statement in an insurance policy outlining the provided coverage and premium
requirements?
In the insuring agreement.
Identify a cause of loss that typical insurance policies are unlikely to cover.
Nuclear hazard.
In a dispute about a claim's settlement after a loss, which section of a policy specifies resolution
procedures?
Conditions.
2
, A court's decision favored the insured based on ambiguity in policy language. This ruling occurred
because of what insurance contract principle?
Ambiguity is interpreted in favor of the insured.
How do aleatory contracts function within insurance?
They depend on an uncertain future event.
An insurance company regulated outside the U.S. is known as?
An alien insurer.
What kind of insurance provider sells public shares and is owned by shareholders?
A stock company.
What type of insurance does a business create when it cannot find affordable coverage and forms a
specialized provider for its own needs?
A captive insurer.
What can an Oregon resident seek if they cannot find standard insurance coverage locally?
Surplus lines insurance from a non-admitted insurer.
What is Monica’s flood-prone home classified as by her insurer?
A hazard.
If a high-crime neighborhood resident's property is damaged by graffiti, what would the act of vandalism
be considered?
A peril.
Which example does not demonstrate indirect loss following a fire?
Damage from water sprayed by firefighters to control flames.
3
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