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Florida Claims Adjuster Exam
A __________ is a selected group of hospitals and medical practitioners in a given area who have joined together in an effort to reduce medical costs. A. HMO B. Major Medical Insurance C. Coinsurance D. PPO ANSWER : D. PPO Most plans provide that emergency treatment will be paid even if treated party does not go to service provider on approved list. A customer representative appointed by a general lines agent or agency in transacting only the business of private passenger motor vehicle insurance from the office of that agent or agency is defined as: A. Automobile Agent B. Automobile Representative C. Limited Customer Service Representative D. Limited Customer Service Agent ANSWER : C. Limited Customer Service Representative A General Lines Agent instructs a licensed Customer Representative 4-40 to thoroughly cover the details of a new life insurance product with every Homeowner customer who calls or visits the office. The agent provides training on the new product. Although the Customer Representative does not have a Life License, he or she feels comfortable with the training and does as requested. Which of the following is true? A. This practice is acceptable if done in the office under supervision of General Lines Agent B. This practice is acceptable because adequate training and product knowledge was provided C. This practice is unacceptable and may result in the suspension or revocation of the Customer Representative's license D. This practice is only acceptable if the product training was certified by the Life Insurance Company ANSWER : C. This practice is unacceptable and may result in the suspension or revocation of the Customer Representative's license
A General Lines Claim Adjuster is required to obtain the same number of Continuing Education hours as a licensed Customer Service Representative. A. True B. False ANSWER : B. False A lender has an insurable interest in a home and finds protection in the: A. Loss Payee Clause B. Mortgagee Clause C. Lender Clause D. Additional Insured Clause ANSWER : B. Mortgagee Clause Mortgagee - Homeowner's policy Loss Payee - Automobile policy A licensed General Lines Claim Adjuster is required to complete how many hours of continuing education every two years? A. 6 B. 12 C. 18 D. 24 ANSWER : D. 24 A motor vehicle or mobile home which is a total loss is defined as: A. Lost Profit B. Salvage C. Salvageable D. All of the Above ANSWER : B. Salvage It cannot be restored to prior condition A policy condition, either based on information in the insured's application or inserted by the insurer, is defined as: A. Warranty B. Misrepresentation C. Concealment D. None of the Above ANSWER : A. Warranty
A. HMO
B. PPO
C. Major Medical Plan D. All of the Above ANSWER : A. HMO Referred to as an emerging and increasingly important non-insurance alternative to dealing with risk of health care costs Actual Cash Value ANSWER : Replacement cost minus depreciation After pleading guilty or no contest to a felony, a licensed individual has _________ days to inform the Department? A. 10 B. 20 C. 30 D. 40 ANSWER : C. 30 Alien ANSWER : Insurer other than domestic or foreign (outside U.S.) All of the following are components of Workers Compensation, except: A. Up to $750,000 in Death Benefits B. Reimbursement for Medical Expenses incurred C. Reimbursement for lost wages on percentage basis D. Funeral costs up to $7, ANSWER : A. Up to $750,000 in Death Benefits Compensation for death is payable if death results within one year of an accident or if it follows disability within five years of accident. All of the following are eligible for a Homeowner's Policy, except? A. An apartment tenant B. A condominium owner C. Four-family dwelling owner-occupant D. A business condo owned by a local insurance company ANSWER : D. A business condo owned by a local insurance company Commercial property is not eligible for a Homeowner's policy. All of the following are requirements for the "Code of Ethics," except:
A. Adjusters should not give legal advice B. Adjusters may negotiate with a claimant who is represented by an attorney C. A witness who requests a copy of a statement given must be provided with one D. Adjusters will keep an unprejudiced and open mind ANSWER : B. Adjusters may negotiate with a claimant who is represented by an attorney Adjusters MAY NOT. Bad, adjuster, bad! An adjuster who is a salaried employee under the supervision of the home, branch, or regional claims department of insurers is defined as a(n): A. Company or Staff Adjuster B. Fee Adjuster C. Public Adjuster D. Bureau Adjuster ANSWER : A. Company or Staff Adjuster An adjuster who is self employed and not affiliated with either insurers or bureaus is defined as a(n): A. Fee Adjuster B. Public Adjuster C. Bureau Adjuster D. Independent Adjuster ANSWER : D. Independent Adjuster An adjuster who represents the financial interests of the insured named in the policy is defined as a(n): A. Public Adjuster B. Bureau Adjuster C. Fee Adjuster D. Independent Adjuster ANSWER : A. Public Adjuster An agent representing a health maintenance organization, or as to health insurance only, an insurer transacting health insurance is defined as a(n): A. Health Agent B. Health Representative C. HMO Agent D. None of the Above ANSWER : A. Health Agent
D. None of the Above ANSWER : A. Life Agent An Insurance Company which is formed under the laws of the State of Illinois, and has its Home Office there, is considered a: A. US Domestic Company B. Foreign Company C. Alien Company D. Unadmitted Company ANSWER : B. Foreign Company Domestic: this state (FL) Foreign: other state (still in US) Alien: elsewhere An insured who wishes to purchase flood insurance, but is located in a moderate or low risk flood zone may do so by purchasing a: A. Preferred Risk Flood Policy B. Standard Flood Policy C. Universal Flood Insurance D. None of the Above ANSWER : A. Preferred Risk Flood Policy Although Flood Insurance is provided by the Federal Government, those who are not in a "flood zone" may purchase a preferred risk policy to cover them for a flood claim. An optional alternative providing for adjustment of premium after expiration, based on a guaranteed basic premium to the insurer to which is added the actual losses incurred by the insured. This is defined as: A. Cost-Plus Rating Plan B. Experience Rating Plan C. Retrospective Rating Plan D. None of the Above ANSWER : C. Retrospective Rating Plan Often referred to as Cost-Plus Programs Any loss discovered during the policy period or within 60 days after its expiration (one year after expiration for losses connected with employee benefit plans) is covered regardless of when it occurred. This is defined as: A. Loss Sustained B. Valuation C. Discovery
D. None of the Above ANSWER : C. Discovery If XYZ restaurant discovers stolen goods taken over a year ago, this is within 2 years of inception date and found within policy period so it's covered. Any material which is or may have been a motor vehicle or mobile home, which is inoperable and which material is in such condition that its highest or primary value is either in its sale or transfer as scrap metal or for its component parts, or a combination of the two. This is defined as: A. Junk B. Derelict C. Major Component Parts D. None of the Above ANSWER : B. Derelict Applies only to a BI or PD which occurs on or after the retroactive date, and for which the claim is received or recorded by an insured or the company during the policy period: A. Occurrence B. Claims-Made C. Operations Completed D. None of the Above ANSWER : B. Claims-Made Retroactive date is stated in Declarations and will normally be same date as issuing company's first claims-made effective date for insured. Applies to BI or PD which occurs during the policy period, regardless of any later time at which a claim is made: A. Occurrence Form B. Claims-Made Form C. Premises and Operations Exposure D. None of the Above ANSWER : A. Occurrence Form vs. Claims-Made: applies only to BI or PD occurring on or after retroactive date for which claim is received/recorded during policy period Appointment ANSWER : Authority given by an insurer or employer to a licensee to transact insurance or adjust claims on their behalf
and indirect losses related to properties other than 1-4 family dwelling and farm properties Compare/contrast different types of adjusters. ANSWER : 1. Independent Adjuster - self-employed and not affiliated with either insurers or bureaus
- Company/Staff Adjuster - salaried employee under supervision of home, branch, regional claims department of insurers
- Public Adjuster - represents the financial interests of the insured named in the policy
- Claims Adjuster - one who is involved in the investigation, adjustment, negotiation and/or trial preparations of claims arising under insurance policies
- Bureau Adjuster - agent of adjustment bureau which serves multiple company clients *Independent and Bureau are both "Fee Adjusters" Cover only losses that both occurred and were discovered during the policy period, or within one year of its expiration. This is defined as: A. Discovery B. Loss Sustained C. Sustained Loss D. None of the Above ANSWER : B. Loss Sustained One exception to the rule is that Loss Sustained forms will also cover losses that occurred under previous (expired) crime policies and that were discovered during current policy year, as long as crime coverage had continued w/o interruption Covers for all types of property, when surrendered away from the premises as a result of a threat to do bodily harm to the insured or an employee, or to a relative or invitee of either, who is (or allegedly is) being held captive. This is defined as: A. Extortion B. Surrendered Property C. Client's Property D. None of the Above ANSWER : A. Extortion Also triggered by threats to damage the premises or property within the premises. Crime Insurance is _________ over any other Insurance coverage. A. Primary B. Secondary
C. Excess D. Recess ANSWER : C. Excess A situation may arise where another form of insurance will pay claim - that insurance would be primary. Damaged property that may be retrieved, reconditioned and sold to reduce an insured loss is defined as: A. Junk B. Salvage C. Covered Property D. Peril ANSWER : B. Salvage Efficient disposal of salvage reduces amount of loss to either insured or insurer Defaming a competitor company or agent is not only unprofessional, it can also result in a license suspension. A. True B. False ANSWER : A. True Define the coverage that pays a flat amount per day for hospitalization, regardless of expenses or other insurance: A. Hospitilization B. Hospital Indemnity C. Hospital Services D. All of the Above ANSWER : B. Hospital Indemnity Derelict ANSWER : Material which is or may have been a motor vehicle or mobile home, with or without all component parts, which is inoperable and which material is in such condition that its highest or primary value is either in its sale or transfer as scrap metal or component parts or both Domestic ANSWER : Insurer formed under laws of this state Duties and functions of the Department of Financial Services include all of the following except:
that impression and is damaged as a result, the guilty party may be legally prohibited (estopped) from asserting that the fact does not exist. Evaluation ANSWER : Establishing a dollar value on a claim. Determines the fair payment in accordance with the contract and applicable law Every licensee shall notify the department, in writing, after a change of name, residence address, principal business street address and/or mailing address within how many days? A. 60 B. 30 C. 15 D. 90 ANSWER : B. 30 Express Waiver ANSWER : Occurs when insurer or its representative knowingly gives up a known right under insurance contract Fiduciary ANSWER : A relationship that requires maintenance of a high degree of fidelity and loyalty to the interests of the principal, whether or not the adjuster is a direct employee First developed as an extension of Ocean Marine coverage, to provide coverage for cargo traveling over land, instead of by sea. A. Commercial Inland Marine Coverage B. Personal Inland Marine Coverage C. Ocean Commercial Coverage D. None of the Above ANSWER : A. Commercial Inland Marine Coverage Definition: to help identify kinds of risks which are eligible for either Ocean or Inland Marine insurance. Foreign ANSWER : Insurer formed under laws of another state, district territory, or commonwealth of U.S. Frank has a not-at-fault accident, he has basic PIP, no deductible and Med pay of $5,000. How much will his Med Pay contribute to medical bills of $15,000? A. $15,
B. $5,
C. $3,
D. $0, Frank is not-at-fault ANSWER : B. $5, Medical Payment limits apply per person; Frank will receive full amount towards medical bills. Frank owned a home that was destroyed by a hurricane. Both ABC and XYZ Banks were listed as additional interests on his homeowner policy. The insurance company will make a payment to: A. The first mortgagee, ABC B. The Insured C. Jointly to ABC and XYZ D. All listed interests ANSWER : D. All listed interests Remember that the insurer is not responsible to know the degrees of interest. In the event of a loss, one payment is made by the insurer and it is up to the additional interests on working out their share. Guarantees the performance between the principle and the obligee: A. Principal B. Obligee C. Surety D. All of the Above ANSWER : C. Surety aka Bonding Company; Surety is a "guarantee" HMO (pre-paid fixed fee) ANSWER : (Health Maintenance Organization) Provides comprehensive health services to its members for a prepaid fixed fee equivalent to an insurance premium How does PIP apply to pedestrians (in and out of state)? ANSWER : PIP applies to Florida residents if struck by insured's motor vehicle while not occupying a self-propelled vehicle (a pedestrian). In situations wherein PIP does not apply, named insured and relatives occupying or struck by others vehicles out-of-state; nonresident passengers out-of-state; and nonresidents as pedestrians in Florida - The No-Fault Law has no applicability and usual legal remedies and other insurance coverage's are to be relied upon.
A. Severability B. Conditional C. Warranty D. None of the above ANSWER : A. Severability Insures a condominium association against direct physical loss or damage to buildings, business personal property and personal property of others in the care, custody or control of the association and located at the premises: A. Condominium Association Form B. Condominium Unit Owners Form C. Condominium Insured Owner Form D. None of the Above ANSWER : A. Condominium Association Form This, along with Condo Unit Owners Form, is located under Condo Coverage. Jeremy has a not at fault accident. If he has PIP with a $1,000 deductible, how much can he expect his PIP coverage to pay toward his medical bills that total $3,000? A. $1, B. $1, C. $2, D. $3, ANSWER : A. $1, 3000 (bills) - 1000 (deductible) = 2000 x .80 (eighty percent) Jeremy owns a home that is recently damaged due to a hurricane. The repair estimate is averaged at $25,000 and Jeremy decides to stay in a hotel because most of the damage is to his bedroom and kitchen. Under a Homeowner's Policy, what coverage will pay for the hotel room bill? A. Fair Rental Value B. Value Obligation C. Loss of Use D. Insurers Duties ANSWER : C. Loss of Use The insurer will pay any necessary and reasonable expenses associated with a daily living routine. Junk ANSWER : Any material which is or may have been a motor vehicle or mobile home,
with or without all component parts, which is inoperable and which material is in such condition that its highest or primary value is either in its sale or transfer as scrap metal Known Loss ANSWER : Prevents insured from coverage if insured knew the loss was probable at time of contract Liability ANSWER : Negligence of the insured Liberalization states, "The insured gets the benefit of any broadened coverage if the company, within __________ days of inception, adopts a form revision that is broader and without increase in premium." A. 10 days B. 55 days C. 65 days D. 45 days ANSWER : D. 45 days Loss Payee Clause ANSWER : Provides, in event of payment being made under the policy in relation to insured risk, that payment will be made to a third party rather than the beneficiary Mandatory for risks exceeding certain annual premiums, recognizes the prior loss experience of the risk and applies either a debit for unfavorable experience or a credit for better-than-expected loss results. This is defined as: A. The Experience Rating Plan B. The Retrospective Rating Plan C. The Risk Plan D. None of the Above ANSWER : A. The Experience Rating Plan This, along with Retrospective Rating Plan, is a manual rating process until premiums reach a certain level. May act as part of the bonding party and agrees to reimburse the surety for any loss it may suffer from having bonded the principal: A. Indemnitor B. Surety C. Obligee
One who is duly authorized by a subsisting certificate of authority issued by the department to transact insurance in this state. This is defined as a(n): A. Unauthorized B. Certified C. Domiciled Insurer D. Authorized ANSWER : D. Authorized One who is involved in the investigation, adjustment, negotiation and/or trial preparations of claims arising under insurance policies is defined as: A. Insurance Agent B. General Lines Agent C. Claims Adjuster D. All of the Above ANSWER : C. Claims Adjuster Commonly referred to as claims auditor One who undertakes to perform, to fulfill a contract or to meet an obligation is known as: A. Principal B. Obligee C. Surety D. All of the Above ANSWER : A. Principal Obligee - needs guarantee principal will perform Surety - guarantees performance between principal and obligee Other Structures ANSWER : Homeowner's Policy, covers items not permanently attached to main dwelling (shed, fence, etc.) Passed during a legislative session in 1993, this association was created for employers who cannot obtain workers compensation insurance in the private market: A. FWCJUA B. FWUA C. Citizens D. FRPCJUA E. FAJUA ANSWER : A. FWCJUA Personal Injury Protection, or PIP, has a __________ per person, per accident limit.
A. 10,
B. 20,
C. 1,
D. Depends on the damaged property ANSWER : A. 10, PPO ANSWER : (Preferred Provider Organization) Selected group of hospitals and medical practitioners in given area who have joined together in an effort to reduce medical costs Property insurance policies usually contain a(n) __________ clause, stating the insured cannot dump damaged property on the insurer and demand its full value: A. Pro Rata B. Abandonment C. Liberalization D. All of the above ANSWER : B. Abandonment Protects against loss of business income that results from damage to covered property from a covered cause of loss. A. Business Income Insurance Coverage B. Business Income Replacement Coverage C. Business Income Actual Value Coverage D. None of the Above ANSWER : A. Business Income Insurance Coverage Period of restoration begins 72 hours after date of direct damage. In effect, coverage has a 72 hour deductible. Coverage ends on either 1. date when damaged property could be repaired, rebuilt, or replaced 2. date business resumes operations at new, permanent location (whichever comes first) Provides coverage for expenses, including loss of income, arising from an accident. This is defined as? A. Accident Insurance B. Hospitilization C. Hospital Pay D. None of the Above ANSWER : A. Accident Insurance
