Exam 1 insurance licensing florida QUESTIONS
AND ANSWERS ALL CORRECT
What is the primary difference between a staff adjuster and an independent adjuster? Correct
Answer: A staff adjuster works for an insurance company and an independent adjuster works
independently for themselves or for adjusting firms who represent many clients.
A couple has insured their home for $150,000. A fire ensues and guts their home, resulting in a
total loss. An appraisal of the home prior to loss results in a value of $120,000, yet the adjuster is
required by law to pay the couple $150,000. This is known as the application of: Correct
Answer: The valued policy law.
The doctrine of proximate cause is defined as: Correct Answer: If there is an unbroken chain of
events, or series of consequences, flowing from the initial loss caused by the insured peril to a
subsequent loss, the insured peril causing the initial loss will be considered the "proximate
cause" of the subsequent loss.
An adjuster's responsibility as a fiduciary means: Correct Answer: The adjuster represents, and
controls, the property and financial interests of the client, to whom he/she owes a high degree of
loyalty and good faith.
The Adjuster's Code of Ethics starts with a basic premise which states: Correct Answer: The
work of adjusting engages the public trust.
Breach of contract by a carrier or its adjuster, through non-payment or non-compliance with
policy requirements, could have which of the following consequences for a carrier (select one
from the following): Correct Answer: If found guilty of a breach of contract, the carrier could be
punished with a "bad faith" verdict that would cost it millions of dollars.
When you purchase insurance, you are buying: Correct Answer: Peace of mind that if an insured
event does occur, that the insurance company will keep its promise and provide the financial
protection that you purchased.
Which of the following would not be a preferred claims practice or behavior under Florida's
Unfair Insurance Trade Practices Act? Correct Answer: Not responding to an insured's calls
because you haven't made up your mind yet.
One of the most important claim handling goals of an insurance company is: Correct Answer:
To help those who have been injured, or who have suffered loss for which the insured is
responsible, while at the same time minimizing loss for the insured party and carrier.
Which of the following is NOT an example of "compensatory damages": Correct Answer: A
jury verdict of $1,000,000 against the defendant to punish them for their reprehensible actions in
causing the loss.
AND ANSWERS ALL CORRECT
What is the primary difference between a staff adjuster and an independent adjuster? Correct
Answer: A staff adjuster works for an insurance company and an independent adjuster works
independently for themselves or for adjusting firms who represent many clients.
A couple has insured their home for $150,000. A fire ensues and guts their home, resulting in a
total loss. An appraisal of the home prior to loss results in a value of $120,000, yet the adjuster is
required by law to pay the couple $150,000. This is known as the application of: Correct
Answer: The valued policy law.
The doctrine of proximate cause is defined as: Correct Answer: If there is an unbroken chain of
events, or series of consequences, flowing from the initial loss caused by the insured peril to a
subsequent loss, the insured peril causing the initial loss will be considered the "proximate
cause" of the subsequent loss.
An adjuster's responsibility as a fiduciary means: Correct Answer: The adjuster represents, and
controls, the property and financial interests of the client, to whom he/she owes a high degree of
loyalty and good faith.
The Adjuster's Code of Ethics starts with a basic premise which states: Correct Answer: The
work of adjusting engages the public trust.
Breach of contract by a carrier or its adjuster, through non-payment or non-compliance with
policy requirements, could have which of the following consequences for a carrier (select one
from the following): Correct Answer: If found guilty of a breach of contract, the carrier could be
punished with a "bad faith" verdict that would cost it millions of dollars.
When you purchase insurance, you are buying: Correct Answer: Peace of mind that if an insured
event does occur, that the insurance company will keep its promise and provide the financial
protection that you purchased.
Which of the following would not be a preferred claims practice or behavior under Florida's
Unfair Insurance Trade Practices Act? Correct Answer: Not responding to an insured's calls
because you haven't made up your mind yet.
One of the most important claim handling goals of an insurance company is: Correct Answer:
To help those who have been injured, or who have suffered loss for which the insured is
responsible, while at the same time minimizing loss for the insured party and carrier.
Which of the following is NOT an example of "compensatory damages": Correct Answer: A
jury verdict of $1,000,000 against the defendant to punish them for their reprehensible actions in
causing the loss.
