FLORIDA ADJUSTER LICENSE TEST ANSWERS
FLORIDA ADJUSTER EXAM LATEST 2023 ACTUAL
EXAM 200 QUESTIONS AND CORRECT ANSWERS
(VERIFIED ANSWERS) |AGRADE
Which of the following is TRUE? - ANSWER- If an appointment is
terminated, an adjuster has 48 months to secure another appointment
Bad Faith & Adjusting Practices - Under the Florida Unfair Trade
Practices Act & the Unfair Methods of Competition and Unfair or Deceptive Acts, all of the following are prohibited, EXCEPT: - ANSWER- Adjuster keeps accurate records on a claim
Florida's Administrative Code contains a Code of Ethics for Adjuster - which of the following is FALSE? - ANSWER- An Adjuster owes fair and prompt treatment to their own company's policyholders only
Which of the following is a duty owed to an invitee? - ANSWER- land
owner must make reasonable efforts to maintain property in safe
condition What is the difference between liability and coverage? - ANSWERliability is a legal doctrine and coverage is a contractual obligation Which of the following is NOT one of the fiduciary responsibilities of
an adjuster? - ANSWER- Withhold pertinent information from the
company to please a client
Which of the following is NOT one of the duties of the Florida
Department of Financial Services? - ANSWER- The Department writes
policies for the non-standard insurance companies. Continuing education requirements to maintain a Customer
representative license are: - ANSWER- 24 hours every two years.
When an insurance licensee ends his appointment with an authorized
company in Florida, he has how long to secure another appointment? - ANSWER- 48 months
When an insurance licensee moves, he has how long to notify the
Florida Dept. of Financial Services of his change of address? - ANSWER- 30 Days
Activities that may result in license suspension or revocation include: - ANSWER- Using discriminatory practices Making false entries on an
insurance application Defaming another agent or company
Activities that may result in license suspension or revocation include: - ANSWER- Lacking reasonable knowledge & technical competence
Misappropriation of funds Failure to notify the Dept. of Insurance in writing within 30 days after pleading guilty to a felony
All of the following are true concerning Joint Underwriting Associations
EXCEPT : - ANSWER- It is not possible to purchase a Homeowners or Dwelling Policy from Citizens
John wrote a policy through the Florida Automobile Joint Underwriting
Association, and the company issued the policy. What is the company
issuing the policy called ? - ANSWER- A servicing carrier The business auto policy has flexibility to meet the needs of various
commercial enterprises. It is used to cover vehicles NOT covered by the
Personal Auto Policy. Which the following vehicle would NOT be
insured with a business auto policy: - ANSWER- Autos used for business related purposes on a regular basis.Autos weighing 12,000 lbs. gross vehicle weight.Autos titled in the name of a corporation or other business interest.
In the business auto policy, symbol 1 is a broad coverage often used for
liability to denote: - ANSWER- "any auto"
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of $215,000. How much will Jack's Uninsured Motorist pay for this
claim? - ANSWER- $150,000
An insured buys an ISO Mechanical Breakdown Coverage Policy on his used car. For what length of time and mileage will he have coverage? - ANSWER- 12 Months / 12,000 Miles
If Jack has an accident that is his fault, Jack has liability insurance with
10/20/10 limits, Extended PIP with no deductible, & Med Pay of $2,000
... what is the maximum potential payment from Jack's Personal Auto
Policy to a guest passenger, who suffers injury and does not own an
auto, has no auto insurance and has $42,000 in medical expenses? - ANSWER- $22,000 (PIP $10,000; Med Pay $2,000; BI $10,000)
UM (Uninsured Motorist) coverage under the PAP (Personal Auto
Policy) pays for: - ANSWER- bodily injury to the insured caused by hit
and run driver Lender's interests in REAL property are protected with a Mortgage
clause, how are lender's interests protected in personal property - such as
automobiles? - ANSWER- Loss payable clause
While driving on the Pennsylvania Turnpike, William's auto has a
collision with a deer that jumps in front of his car. In order for coverage
to be afforded, William's Personal Auto Policy must have: - ANSWER- Other than Collision coverage
An insured took his TV to a shop for repairs, on the way, he stopped
suddenly and the TV fell off the seat, breaking the TV. How will his
PAP (Personal Auto Policy) respond? - ANSWER- The PAP will not respond. An insured has "Stacked" Uninsured Motorist with 25/50 limits on each
of 2 vehicles that he owns. How much Uninsured Motorist coverage is
available to the insured in the event of an accident with a hit & run
driver? - ANSWER- 50/100
The "trigger" of the financial responsibility law is: - ANSWER- An
accident involving bodily injury or property damage rendering the vehicle inoperable or a serious violation such as DUI. Which of the following is the lowest single limit automobile liability that meets the requirements of the Florida Financial Responsibility Law? - ANSWER- $30,000
An insured had an accident in another state that required liability limits
of 25/50/25. Our insured had 10/20/10 limits. What happens if the
liability he incurs exceeds 10/20/10? - ANSWER- Our insured's policy will respond to the higher limit of the other state
Joe has 10/20/10 liability limits, and he borrows Sue's car. Sue has
15/30/15 limits of liability. Joe injures a pedestrian while driving Sue's
car and the pedestrian's medical bills due from liability total $22,000
(PIP & Med Pay are paid out in full). How much is paid from Liability?
- ANSWER- Sue's policy pays $15,000 & Joe's policy pays $7,000
Your insured has purchased the minimum split limit policy that meets
Financial Responsibility Law in Florida. He causes the following bodily
injuries to passengers:
Carl $12,000
Jeanne $10,000
Charlie $10,000
How much will his policy pay? - ANSWER- $20,000 for the total BI
portion of accident
An insured has 25/50/25 limits and injured another person. The injured
person won a tort claim for $30,000 against the insured and the insured's
attorney charged $7,500 to defend the insured. How much is paid by the
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following best describes this method of settlement? - ANSWER- No
release or walk-away
The Continuing Education requirement to maintain an Adjuster license
in Florida is: - ANSWER- Twenty four hours every two years. An adjuster received written notice from the Department of Financial
Services regarding a claim. What length of time does he have to respond
to the inquiry? - ANSWER- 21 calendar days
Comparative negligence is determined through - ANSWERInvestigation & AnalysisAgreement between parties or by mediation or arbitrationJudge and/or jury
During what period of time must an adjuster reply to communication
from a policyholder on a claim? - ANSWER- 14 days
Which of the following is NOT a goal in the adjusting process? - ANSWER- always pay the maximum limit of the policy
An adjuster offered a claimant a settlement where the full payment would be presented and a release was signed. This is called a: - ANSWER- A Full Release settlement
Adjuster Jane moved from one city in Florida to another. What length of
time does she have to notify the Insurance Department of the address
change? - ANSWER- 30 Days
Which of the following could NOT be considered an "owner" of a motor vehicle? - ANSWER- A long term lease of 3 months
Which of the following is true concerning the extended PIP
endorsement? - ANSWER- Medical expense reimbursement is raised
from 80% to 100%
When an Additional PIP Endorsement is added to the Personal Auto
Policy, we know that the policy already has - ANSWER- Extended PIP
Endorsement
Nonresidents must comply with the Florida No Fault law: - ANSWERIf their auto is in Florida over 90 of the last 365 days
When is the named insured NOT entitled to PIP benefits? - ANSWERInjured outside of Florida while a pedestrian struck by a defined motor vehicle
Which of the following statements is false concerning No-Fault Auto
Insurance? - ANSWER- Negligence must be established. An insured has Basic PIP with no deductible, in an accident he incurs medical bills of $8,000, $1,000 in lost wages, and $500 in replacement
services - how much will PIP portion of policy pay? - ANSWER- $7,500
Jane is a Florida resident with an auto. She has PIP coverage of $10,000 with no deductible. If she is in an auto accident and has medical bills of
$10,000, how much will her PIP pay? - ANSWER- $8,000
If Jane also has work loss of $1000 due to the auto accident, how much will her PIP pay for work loss? - ANSWER- $600
What if Jane's accident happened during the work day while she was
driving a GEICO owned auto and Jane was out adjusting auto claims. How much would Jane's PIP pay for her medical injuries? - ANSWER- zero
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What type of health insurance plan usually offers the broadest coverage
at the lowest cost with the most freedom of choice? - ANSWER- Group
Insurance PPO
Insurance is considered a two-party contract, Surety Bonds are
considered - ANSWER- a three-party contract
A builder contracted for framing on a new section of a hospital. There is
a surety bond purchased to guarantee completion of the project. Which
of the following best describes the hospital position in the surety bond? - ANSWER- The hospital is the obligee
The Surety attempts to avoid default by investigating the principal with
regard to: - ANSWER- CharacterCapabilityCollateral
The Surety bond that guarantees that companies will not misrepresent
securities is - ANSWER- Blue Sky Bond
A Surety Bond that guarantees the performance of a person appointed by
a court, or named in a will or trust to take possession of property, collect
assets, make investments, pay debts, sell assets, carry on a business, distribute property to heirs, or any related tasks is what type ? - ANSWER- Fiduciary Bond
If an insured's administrative assistant fraudulently forged the insured's name on a check, and cashed it, which of the following would cover this
event? - ANSWER- Employee theft
Under one form of crime insurance, losses must occur during the policy
period and be discovered within 1 year of policy expiration. This is: - ANSWER- The Loss Sustained Form Which of the following type of employee theft best fits a business with a
large turnover in its personnel? - ANSWER- The Blanket coverage
A loss discovered during the policy period that occurred before the
inception of the current policy may be covered by? - ANSWER- Discovery Form Which of the following could be covered by crime insurance? - ANSWER- A burglar breaks into a locked safe and steals a ruby
necklace. An employee is robbed while taking the daily cash receipts to
the bank. A computer hacker breaks into a business computer and
transfers a deposit to an account in the Cayman Islands. Two of Any Corp. employees were working and one was accidentally
pushed into a machine that cut his arm. How would Any Corp's general
liability respond? - ANSWER- Neither CGL nor the med pay section would respond, and coverage for this accident is found under Workers
Compensation Sam was injured on the job and missed 22 days of work. Which of the
following best describes the Workers Compensation payment to Sam? - ANSWER- Sam will be paid for all 22 days, since the 7 day waiting
period is not imposed if the disability lasts more than 21 days
All the following are components of the Workers Compensation EXCEPT: - ANSWER- Unlimited death benefits
What is the limit on medical benefits under Workers Compensation? - ANSWER- All medical costs with no limit
The following are employees who must have workers compensation EXCEPT: - ANSWER- Pro athletes
A claimant ate some undercooked fish and got violently ill at the
restaurant. Which of the following would pay for this occurrence? - ANSWER- A premises and operations form
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The coverage for damage to an aircraft under the care, custody, or control of the insured while the plane is in for storage or service is: - ANSWER- Hangarkeepers liability
Under the commercial property form, what length of time must expire
before a building is considered "vacant", thus suspending some
coverages, while reducing payment on others? - ANSWER- 60 Days
A florist wanted coverage on business contents that vary in amount over
the course of a year. Which form best covers this situation? - ANSWER- The value reporting endorsement
Both commercial property and liability were combined into one policy, thus saving money on underwriting expense. What is this combination
called? - ANSWER- A package policy
A ship loaded with lumber encountered a terrible storm, and some of the
lumber was thrown overboard to save the ship - this action is called: - ANSWER- Jettison A contractor was concerned some of his tools, such as a welder, could be
stolen from the job site. What inland marine form is best suited for this
exposure? - ANSWER- The contractors equipment floater
In Commercial Policies - Vacancy of more than 60 days suspends
coverage on all the following EXCEPT : - ANSWER- Windstorm
Condominiums may be covered by both an Association (Commercial
Condo) Policy and a Unit Owners' (Homeowners) Policy, which of the
following is true? - ANSWER- The Association Policy is primary and
the Unit Owners' Policy is excess
There are advantages of an agent recommending a commercial package
policy over several monoline policies. Which of the following is an
advantage? - ANSWER- The package policy is easier to rate and sell -
more efficient .In the package policy, coverage gaps are less likely to
occur. Premium savings may result from a package policy. A shipper contemplates 10 or 11 loads of produce to be shipped to
Pennsylvania over the course of the next 12 months. What inland marine
coverage best fits this exposure? - ANSWER- An annual transit policy
Commercial leases have special coverages in the Leasehold Coverage
Form due to the fact that - ANSWER- they are long-term often with
investment in the real estate. A home oxygen service must continue to supply its customers even if
the facility is destroyed by a fire. Consequently, the service may make
purchases from one of its competitors to keep their own customers
supplied with medically necessary equipment in order to have the
opportunity to stay in business. Where is this type of insurance coverage
found ? - ANSWER- Extra Expense Coverage form
A community applied to be part of the National Flood Insurance
Program. Until they are approved, what is the status of the community? - ANSWER- They are in the emergency program Which of the following would be excluded (NOT covered) under a
personal articles floater on an "all risks" basis? - ANSWER- Insects
destroy a valuable postage stamp worth $500
Which of the following is false concerning flood insurance? - ANSWER- To be insured for flood, a new building only must have the walls up. All of the following are EXCLUSIONS under a personal articles floater
(Personal Inland Marine Policy) EXCEPT: - ANSWER- Theft
An Umbrella Policy may be broader than the underlying policies and
respond as primary coverage. When the Umbrella is PRIMARY, there is
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Which of the following is NOT one of the rating factors used in
determining a H/O (Homeowners) premium? - ANSWER- Gender of
owner
Jane has a dwelling policy with the house insured for $40,000. If her detached shed, which is valued at $4500, is destroyed by a covered peril, what can she expect? - ANSWER- She can expect $4,000 to be paid, because unattached structures are covered up to 10% of the dwelling
amount. Homeowners Policies usually insure property for which of the
following? - ANSWER- Fire, lightning, theft
If the policy holder has a HO-3 policy with no endorsements and there is
a fire - jewelry worth $20,000 in the house might be covered: - ANSWER- Could be covered for $20,000 if the Coverage C limit is high
enough
Liability limits may be expressed as a: - ANSWER- Aggregate Limit
Split Limit Single Limit
An insured has A SPLIT limit liability policy with 10/20/10 limits. He
owes the following people liability bodily injuries claims of: Passenger 1 = $12,000, Passenger 2 = $10,000, Passenger 3 = $18,000. How much
liability insurance will his policy pay for these claims? - ANSWER- $
20,000
Loss payee - ANSWER- If a lender has an insurable interest in an auto, because of the money loaned to finance the auto, the lender would
appear on the policy as the:
To turn partially damaged property over to the insurance company and
ask them to pay for a total loss is called - ANSWER- Abandonment
Firemen caused water damage to a property by spraying water to put out
a fire. If the property insurance policy listed "fire" as the only named
peril: - ANSWER- The water damage is covered due to the concept of
proximate cause. XYZ Insurance Corp. filed its corporate charter in Tallahassee and has
its home office in Tampa: - ANSWER- In Florida, XYZ is a domestic
insurer. An insured has a home with a replacement cost / value of $100,000, on which he carries an insurance policy for $80,000 with an 80%
Coinsurance clause. The insured has a $20,000 partial loss, the insurance
company will pay how much for this partial loss of $20,000?
(Remember $80,000 is 80% of $100,000) - ANSWER- 20,000
"Actual Cash Value" ACV means: - ANSWER- Current cost to replace minus depreciation Which of the following is TRUE concerning Subrogation? - ANSWER- Allows the insurer to sue a negligent third party to recover a loss paid. An insurer may sever the interests of 2 insureds so that the insurer can
protect an innocent party - this is the Doctrine of: - ANSWER- Severability
All of the following describe insurable interest EXCEPT: - ANSWER- Show a similarity between insurance and wagering. An Insurance Policy is a contract with all of the following
characteristics, EXCEPT - ANSWER- Indemnity is not part of an
insurance contract
An insurance contract may contain a "gray area" or an ambiguity, that is
generally resolved in favor of the insured because insurance policies are
contracts of: - ANSWER- Adhesion
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5. Reserve should always be enough to cover losses
Principle of Indemnity - ANSWER- Restoration to previous financial
condition; no more, no less.
Indemnification - ANSWER- Being restored to the financial condition
you were in before a loss
Insurance Policy (ACCL) - ANSWER- 1. Contract to provide financial
protection for a fee
2. Legally binding because it meets the 4 requirements of a legal
contract
Four Qualification (Insurance Policy-Legal Contract) - ANSWER- 1. Agreement: mutual consent (signature or handshake)
2. Consideration: all parties bring something of value (money in
exchange for a car)
3. Competent parties: 18 years old, sober, and sane
4. Legal purpose: no contract for money laundering (has to be legal)
Insured - ANSWER- Individual or organization that pays premiums in
exchange for protection
Insurer - ANSWER- Company, group, or government agency offering
financial protection Risk (meaning) - ANSWER- When an insurer issues an insurance
policy, the actual item, person, or organization that is being insured. Personal
(Six Special Characteristics of Insurance Contracts) - ANSWER- The
insured person is protected from losses; not the covered property
D.I.C.E. - ANSWER- 1. Declarations Page (aka "Dec Page")/Definitions
Section
2. Insuring Agreement
3. Conditions
4. Exclusions/Endorsements
Declarations Page ("Dec Page") - ANSWER- Makes contract specific to
the policyholder (names of both parties; location & description of
insured item; value of insured item; dates of the policy (beginning and
end); amount and limit of coverage; deductible; and premium. Definitions Section - ANSWER- 1. Not technically essential, but
common in policies
2. defines terms used to write policy including: - "collision," "decay," "like kind and quality." 3. includes important language for adjusters to know
Insuring Agreement Section - ANSWER- Insurer agrees: - what is covered
- which causes of loss are covered
- any service provided
- any exclusions to coverage
- the maximum limit of policy coverage in dollars
Conditions Section - ANSWER- The Insurer specifies any limits or qualifications the policyholder must meet
(example)
Requiring a security guard for a jewelry store
How to file a proof of loss
How to protect the property after a loss
Exclusions Section - ANSWER- List what the policy DOES NOT cover:
Common Exclusions (in nearly all property policies)
- earthquakes
- flooding
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