Texas all lines Adjuster Exam with
Completing Solutions
All of the following are criteria for an accident to have occurred "in the course of" the
employment under a workers' compensation policy, EXCEPT: - ANS-While performing a
task that a fellow worker requested, that was unusual to the employee's job description,
but occurred on the employer's premises during working hours.
Which of the following statements is NOT TRUE regarding the implied warranties of an
Ocean Marine policy? - ANS-The implied warranties are attached to the policy as an
endorsement..
Parmelia is covered under two separate standardized Personal Automobile policies,
with Part C limits under both policies set at $200,000. Parmelia is involved in an
accident with an uninsured motorist and she sustains bodily injury damages for
$262,320. How much will Parmelia receive when she submits a claim for these
damages - ANS-$200,000
Which of the following endorsements must be attached to a standard Businessowners
policy for coverage to apply to a businesses freezer that was damaged by the
interruption of a power source - ANS-Utility Services - Direct Damage endorsement.
After completing an inspection of an insured's pressure equipment and fire suppression
systems, the inspector determines that the pressure equipment needs to be repaired
and the suppression systems have not been cleaned and inspected in the time frame
required by the policy. The insurer will: - ANS-Suspend coverage immediately by red
tagging the items until they are repaired, cleaned and pass reinspection
To be eligible for coverage under a standardized Dwelling policy, the insured must not
allow more than _______ boarders to live on the premises. - ANS-5
All of the following are "Perils of the Sea" under an Ocean Marine policy, EXCEPT: -
ANS-Pirates
The amount of insurance countersigned, issued, or sold by an agent or producer to
cover immediate family members, an employer, or employees is known as: - ANS-
Controlled business
Which of the following standardized Dwelling insurance forms provides coverage for
loss of rental income - ANS-The DP-1, DP-2, and DP-3 forms
,The "Part B - Medical Payments" coverage of a personal automobile policy covers
injuries for all of the following, EXCEPT: - ANS-A passenger who is injured in another
vehicle that is struck by the insured's vehicle in an accident
Which of the following are the Texas Workers' Compensation benefits that are
increased by a cost-of-living adjustment (COLAs) - ANS-Lifetime Income Benefits (LIBs)
only
Hannah must take time away from work to help assist in the investigation of a claim that
was made against her BOP policy. The policy will pay for Hannah's actual loss of
earnings up to: - ANS-$250 per day.
Surplus Lines companies in Texas have _____ to acknowledge the receipt of a claim. -
ANS-30 days.
All of the following are characteristics of a principal that a surety will scrutinize during
the underwriting process, EXCEPT: - ANS-Consideration.
Under Section II of a Homeowners policy, a cemetery plot owned by the insured is
considered to be: - ANS-An insured location.
Which of the following is NOT one of the four major coverages of an Ocean Marine
policy? - ANS-Seaworthiness.
A ship has suffered damage and sunk. Which of the following would respond to cover
the loss of the ship? - ANS-Hull Insurance.
As a fiduciary agent, an adjuster has the power to bind the insurer. Which of the
following statements is FALSE regarding this power? - ANS-Only an adjuster's written
statements can legally bind an insurer.
The standardized Dwelling forms consider all eruptions of a volcano within a
__________ period to be a single "occurrence". - ANS-72-hour
Whose responsibility is it to complete a "proof of loss"? - ANS-The claimant.
Which of the following would NOT be determined by a court when an insurer has filed a
declaratory judgment action? - ANS-The type and amount of damages that will be paid
to a plaintiff for the claim that is being disputed.
Which of the following statements is TRUE regarding the Homeowners "additional
coverage" known as Landlord's Furnishings? - ANS-The coverage is not additional
insurance and does not increase the limits of the policy.
Which of the following would be covered under the Jones Act? - ANS-Crew members of
a ship.
,All of the following statements are true regarding a Personal Liability Supplement,
EXCEPT: - ANS-The policy will cover watercraft liability.
Which of the following statements is TRUE regarding Commercial Property coverage? -
ANS-Commercial property coverage can be written as both a monoline policy and as
part of a package policy.
What type of insurance is usually provided or subsidized by the state or federal
government because it is not ordinarily available from private insurers? - ANS-Residual
market insurance.
The optional coverage for "Employee Dishonesty" under a standard Businessowners
policy provides a "discovery period" for the insured to discover the dishonest act and
have coverage still apply. Which of the following statements best describes the
"discovery period" for this optional coverage? - ANS-The "discovery period" is one year
from the end of the policy period.
Which of the following would be considered an Unfair Claim Settlement Practice? -
ANS-Failing to deny coverage of a claim within a reasonable amount of time after
concluding the investigation
Which of the following is TRUE regarding the DP-2 Broad Form coverage for "artificially
generated electrical current"? - ANS-A fire must be the result of the artificially generated
electrical current for coverage to apply..
The Commercial Building and Personal Property coverage form provides five
extensions of coverage, but only if: - ANS-An 80% or higher coinsurance percentage is
shown on the Declarations page, and the property amount of coverage, based on that
percentage, is purchased.
All of the following would be considered "uninsured motorists", EXCEPT: - ANS-A
motorist driving with coverage up to the required state financial responsibility limits for
liability, but not high enough to pay the claims for an at-fault accident.
Regulation of the insurance industry in the United States is primarily left to: - ANS-State
governments.
Which of the following coverages does NOT need to be added to a Garage Coverage
form by endorsement for coverage to apply? - ANS-Collision.
Chaz takes his girlfriend to an expensive restaurant for Valentine's Day. It is raining, so
he decides to have the valet park his car, saving his girlfriend from getting wet. The
valet is driving the car into the restaurant's parking garage, when he clips the side of the
garage entrance with the front fender of Chaz's car. The garage wall needs to be
repaired as well as the fender and headlight of Chaz's car. How would Part D of Chaz's
, Personal Automobile respond to this loss? - ANS-It would cover the loss to Chaz's car
because it is the insured automobile, but would not cover the damage to the garage..
Which of the following statements is TRUE regarding the coverage extension of the
standard Businessowners policy for "Business Personal Property Temporarily in
Portable Storage Units"? - ANS-Coverage will not apply if the storage unit has been on
the insured premises for longer than 90 days, even if the business personal property
has only been stored there for less than 90 days.
Which of the following would be considered a Part D - Other Than Collision claim under
a Personal Automobile claim? - ANS-A load of bricks falling from an apartment building
onto the car.
The Section I Additional Coverage of the standard Businessowners policy provides
coverage for "Debris Removal". Which of the following statements best describes the
limit for this coverage? - ANS-The total limit may be up to 25% of the policy limit for the
loss payable with the deductible included, plus up to an additional $25,000 if the policy
limits are exhausted
An agent, insured or claimant has intentionally deceived an insurer for financial gain.
Such an act is known as: - ANS-Fraud
Which of the following losses would be covered under a Commercial Property policy
with the special cause of loss form attached? - ANS-A fire that breaks out in an office
building and causes damage to two of the offices..
If the Navigational Limits or Lay-Up period shown on the Declarations page of a
standardized Yacht policy is breached because of something out of the control of the
insured: - ANS-The insurer must be notified within 10 days after the breach and any
additional premium that is due must be paid.
Which of the following is NOT eligible for a coverage under a Homeowners insurance
policy? - ANS-Owner-occupants of a 5 to 6-family dwelling
Cameron has his home covered under a Homeowners policy and his limit for bodily
injury is $100,000. He also purchased a Personal Umbrella policy with a $1,000,000
limit of liability. Cameron is sued and a judgement was made against him for $500,000.
To trigger his Umbrella policy, his Homeowners policy must pay $100,000, but he finds
that the insurance company from which he purchased his Homeowners policy has
become insolvent. How will the Umbrella insurer pay the claim (disregarding any
retention limit)? - ANS-The Umbrella policy will not become primary when the insurer
carrying the underlying insurance becomes insolvent, but will pay the $400,000 as if the
underlying insurer had paid its $100,000 limit of liability..
The additional coverage for debris removal under the standardized Building and
Personal Property coverage form will only be paid if: - ANS-The insured reports the
Completing Solutions
All of the following are criteria for an accident to have occurred "in the course of" the
employment under a workers' compensation policy, EXCEPT: - ANS-While performing a
task that a fellow worker requested, that was unusual to the employee's job description,
but occurred on the employer's premises during working hours.
Which of the following statements is NOT TRUE regarding the implied warranties of an
Ocean Marine policy? - ANS-The implied warranties are attached to the policy as an
endorsement..
Parmelia is covered under two separate standardized Personal Automobile policies,
with Part C limits under both policies set at $200,000. Parmelia is involved in an
accident with an uninsured motorist and she sustains bodily injury damages for
$262,320. How much will Parmelia receive when she submits a claim for these
damages - ANS-$200,000
Which of the following endorsements must be attached to a standard Businessowners
policy for coverage to apply to a businesses freezer that was damaged by the
interruption of a power source - ANS-Utility Services - Direct Damage endorsement.
After completing an inspection of an insured's pressure equipment and fire suppression
systems, the inspector determines that the pressure equipment needs to be repaired
and the suppression systems have not been cleaned and inspected in the time frame
required by the policy. The insurer will: - ANS-Suspend coverage immediately by red
tagging the items until they are repaired, cleaned and pass reinspection
To be eligible for coverage under a standardized Dwelling policy, the insured must not
allow more than _______ boarders to live on the premises. - ANS-5
All of the following are "Perils of the Sea" under an Ocean Marine policy, EXCEPT: -
ANS-Pirates
The amount of insurance countersigned, issued, or sold by an agent or producer to
cover immediate family members, an employer, or employees is known as: - ANS-
Controlled business
Which of the following standardized Dwelling insurance forms provides coverage for
loss of rental income - ANS-The DP-1, DP-2, and DP-3 forms
,The "Part B - Medical Payments" coverage of a personal automobile policy covers
injuries for all of the following, EXCEPT: - ANS-A passenger who is injured in another
vehicle that is struck by the insured's vehicle in an accident
Which of the following are the Texas Workers' Compensation benefits that are
increased by a cost-of-living adjustment (COLAs) - ANS-Lifetime Income Benefits (LIBs)
only
Hannah must take time away from work to help assist in the investigation of a claim that
was made against her BOP policy. The policy will pay for Hannah's actual loss of
earnings up to: - ANS-$250 per day.
Surplus Lines companies in Texas have _____ to acknowledge the receipt of a claim. -
ANS-30 days.
All of the following are characteristics of a principal that a surety will scrutinize during
the underwriting process, EXCEPT: - ANS-Consideration.
Under Section II of a Homeowners policy, a cemetery plot owned by the insured is
considered to be: - ANS-An insured location.
Which of the following is NOT one of the four major coverages of an Ocean Marine
policy? - ANS-Seaworthiness.
A ship has suffered damage and sunk. Which of the following would respond to cover
the loss of the ship? - ANS-Hull Insurance.
As a fiduciary agent, an adjuster has the power to bind the insurer. Which of the
following statements is FALSE regarding this power? - ANS-Only an adjuster's written
statements can legally bind an insurer.
The standardized Dwelling forms consider all eruptions of a volcano within a
__________ period to be a single "occurrence". - ANS-72-hour
Whose responsibility is it to complete a "proof of loss"? - ANS-The claimant.
Which of the following would NOT be determined by a court when an insurer has filed a
declaratory judgment action? - ANS-The type and amount of damages that will be paid
to a plaintiff for the claim that is being disputed.
Which of the following statements is TRUE regarding the Homeowners "additional
coverage" known as Landlord's Furnishings? - ANS-The coverage is not additional
insurance and does not increase the limits of the policy.
Which of the following would be covered under the Jones Act? - ANS-Crew members of
a ship.
,All of the following statements are true regarding a Personal Liability Supplement,
EXCEPT: - ANS-The policy will cover watercraft liability.
Which of the following statements is TRUE regarding Commercial Property coverage? -
ANS-Commercial property coverage can be written as both a monoline policy and as
part of a package policy.
What type of insurance is usually provided or subsidized by the state or federal
government because it is not ordinarily available from private insurers? - ANS-Residual
market insurance.
The optional coverage for "Employee Dishonesty" under a standard Businessowners
policy provides a "discovery period" for the insured to discover the dishonest act and
have coverage still apply. Which of the following statements best describes the
"discovery period" for this optional coverage? - ANS-The "discovery period" is one year
from the end of the policy period.
Which of the following would be considered an Unfair Claim Settlement Practice? -
ANS-Failing to deny coverage of a claim within a reasonable amount of time after
concluding the investigation
Which of the following is TRUE regarding the DP-2 Broad Form coverage for "artificially
generated electrical current"? - ANS-A fire must be the result of the artificially generated
electrical current for coverage to apply..
The Commercial Building and Personal Property coverage form provides five
extensions of coverage, but only if: - ANS-An 80% or higher coinsurance percentage is
shown on the Declarations page, and the property amount of coverage, based on that
percentage, is purchased.
All of the following would be considered "uninsured motorists", EXCEPT: - ANS-A
motorist driving with coverage up to the required state financial responsibility limits for
liability, but not high enough to pay the claims for an at-fault accident.
Regulation of the insurance industry in the United States is primarily left to: - ANS-State
governments.
Which of the following coverages does NOT need to be added to a Garage Coverage
form by endorsement for coverage to apply? - ANS-Collision.
Chaz takes his girlfriend to an expensive restaurant for Valentine's Day. It is raining, so
he decides to have the valet park his car, saving his girlfriend from getting wet. The
valet is driving the car into the restaurant's parking garage, when he clips the side of the
garage entrance with the front fender of Chaz's car. The garage wall needs to be
repaired as well as the fender and headlight of Chaz's car. How would Part D of Chaz's
, Personal Automobile respond to this loss? - ANS-It would cover the loss to Chaz's car
because it is the insured automobile, but would not cover the damage to the garage..
Which of the following statements is TRUE regarding the coverage extension of the
standard Businessowners policy for "Business Personal Property Temporarily in
Portable Storage Units"? - ANS-Coverage will not apply if the storage unit has been on
the insured premises for longer than 90 days, even if the business personal property
has only been stored there for less than 90 days.
Which of the following would be considered a Part D - Other Than Collision claim under
a Personal Automobile claim? - ANS-A load of bricks falling from an apartment building
onto the car.
The Section I Additional Coverage of the standard Businessowners policy provides
coverage for "Debris Removal". Which of the following statements best describes the
limit for this coverage? - ANS-The total limit may be up to 25% of the policy limit for the
loss payable with the deductible included, plus up to an additional $25,000 if the policy
limits are exhausted
An agent, insured or claimant has intentionally deceived an insurer for financial gain.
Such an act is known as: - ANS-Fraud
Which of the following losses would be covered under a Commercial Property policy
with the special cause of loss form attached? - ANS-A fire that breaks out in an office
building and causes damage to two of the offices..
If the Navigational Limits or Lay-Up period shown on the Declarations page of a
standardized Yacht policy is breached because of something out of the control of the
insured: - ANS-The insurer must be notified within 10 days after the breach and any
additional premium that is due must be paid.
Which of the following is NOT eligible for a coverage under a Homeowners insurance
policy? - ANS-Owner-occupants of a 5 to 6-family dwelling
Cameron has his home covered under a Homeowners policy and his limit for bodily
injury is $100,000. He also purchased a Personal Umbrella policy with a $1,000,000
limit of liability. Cameron is sued and a judgement was made against him for $500,000.
To trigger his Umbrella policy, his Homeowners policy must pay $100,000, but he finds
that the insurance company from which he purchased his Homeowners policy has
become insolvent. How will the Umbrella insurer pay the claim (disregarding any
retention limit)? - ANS-The Umbrella policy will not become primary when the insurer
carrying the underlying insurance becomes insolvent, but will pay the $400,000 as if the
underlying insurer had paid its $100,000 limit of liability..
The additional coverage for debris removal under the standardized Building and
Personal Property coverage form will only be paid if: - ANS-The insured reports the
