Auto Adjuster Exam 17-66 Questions with 100% correct Answers

Which of the following would not be considered a "first party" coverage under the personal auto policy? - ANSWER-Liability Liability is considered to be "third party coverage." The other coverages pay the insured (the first party) under the policy. Which of the following would be considered "special damages?" - ANSWER-Medical expenses There are two types of damages for bodily injury claims - special damages and general damages. Special damages are those expenses to which one can apply a dollar amount such as medical bills, a rental car, travel expenses to a medical facility and loss of wages. General damages are the most difficult to adjust since they usually require negotiation or even court action for a final determination of the amount owed the claimant. General damages include disfiguration, pain and suffering, punitive damages, loss of consortium and loss of the quality of life. A non-waiver agreement issued by an insurance company is: - ANSWER-A coverage issue.. Non-waiver agreements and reservation of rights letters both serve the following general purposes: 1. To advise the insured that any action taken by the insurance company in investigating the cause of loss or in ascertaining the amount of loss is not intended to waive or invalidate any policy condition, and 2. To clarify that the intent of the agreement is to permit an investigation of the claim and that neither the insured nor the insurer will thereby waive any respective rights or obligations. Which of the following would NOT be covered under coverage C, the Uninsured and Underinsured Motorist Coverage? - ANSWER-Vehicles This coverage does not apply to physical damage to other vehicles. In some states the insured can elect to purchase uninsured motorist property damage coverage that would apply to the insured's vehicle. Special damages are those that the adjuster can assign a dollar amount such as medical expenses and loss of wages. General damages deal with soft tissue injuries or pain and suffering where the damages are usually determined at a later date and negotiated with the insured. The Terrorism Risk Insurance Program Reauthorization Act of 2015 excludes all acts of terrorism if the act is committed as part of the course of a war declared by Congress with the exception of one line of insurance. Which of the following is the only line of insurance that would still be covered in case of a war? - ANSWER-Workers compensation. Workers compensation coverage is the only line of insurance covered by the Act in case of war. The Superintendent of Insurance may approve the employment, appointment or participation of any person whose license has been revoked. Karen Jones had her license revoked and filed an application for relicensing and has waited over 120 days without a response from the Insurance Department. What should or can she do? - ANSWER-Assume the relicensing is approved. If the application for a license has not been approved or disapproved within the 120 days the relicensing is considered approved. Adverse selection occurs when: - ANSWER-Applicants are accepted by the insurer with little or no attention given to underwriting. . Insurers must carefully underwrite all risks to avoid being the victim of adverse selection which is the tendency of insureds with a greater-than-average chance of loss to purchase insurance. With adverse selection, the insurer is confronted with the probability of loss due to risks not factored in at the time of sale. Before revoking or suspending a license, the Superintendent must first send _____ notice and give the accused an opportunity for a hearing. - ANSWER-10 days While stopped in traffic at a red light your car is hit in the rear by Mr. Jones. The damage to your car would be addressed by which of the following coverages? - ANSWER-Mr. Jones property damage liability and your collision insurance. . If Mr. Jones is negligent his policy should pay for the damage under his property damage coverage. The insured can also request payment under his collision insurance and let his insurer subrogate against Mr. Jones. An insurance professional that is accused of dishonesty or breach of trust involving interstate commerce under the Federal Fraud and False Statement Regulation of the United States Code (USC 1033) will be prosecuted by: - ANSWER-The U.S. Attorney general. Which of the following would not be addressed by a court in the determination of a declaratory judgment? - ANSWER-Determine fault or monetary damages. All of the following are covered by the Terrorism Risk Insurance Program Reauthorization Act of 2015, EXCEPT: - ANSWER-Commercial Automobile. Commercial Automobile was covered under the TRIA of 2002, however, with the reauthorization in 2015, it is now excluded. Commercial property, commercial casualty, and workers compensation coverage have been covered since 2002 and are still covered under the 2015 reauthorization. In order to proceed with subrogation, the insurance company generally: - ANSWER-Takes a subrogation assignment from the insured. Under a personal auto policy newly acquired additional vehicles are covered automatically for a limited period of time. This automatic coverage: - ANSWER-Is as broad as the broadest coverage for any vehicle shown in the declarations. . Liability coverage is continuous until the end of the policy period. To continue physical damage coverage certain restrictions and limitations apply as to the number of days the insured has in the reporting of the vehicle to the insurer. In North Carolina it is 30 days. For most other states it is 14 days. In regards to a personal auto policy, which of the following statements is incorrect? - ANSWER-The maximum amount payable under the Supplementary Payments is $250. Supplementary payments provide coverage for expenses incurred by the insurer in the defense of the insured without a limit. No limit is specified for the payment of interest that has accrued as a result of a judgment against the insured. There is a specific limit of $250 for bail bonds and a limit of $200 per day for lost wages as a result of the insured attending hearings etc. in their defense. These payments are in addition to the policy limits of liability. You are assigned the investigation of a head-on collision involving major injuries in both the insured and claimant vehicles. First contact should be made with the: - ANSWER-Driver of the claimant vehicle.. Since this will be a possible third party claim the adjuster should first contact the driver of the claimant vehicle. The death benefit under the New York no-fault plan is: - ANSWER-$2,000 Under New York no fault coverage, the insured can sue for injuries for all of the following, EXCEPT: - ANSWER-Insignificant limitation of use of a body function or system Personal Injury Protection does not apply if the insured is injured while occupying a motorcycle. Which of the following endorsements can be added to provide this coverage? - ANSWER-PP 05 89 for personal auto insurance For personal auto policies endorsement PP 05 89 will add PIP protection for the named insured and resident relatives while riding a motorcycle. CA 22 48 provides the benefit for the named insured in commercial lines. In which of the following situations should an adjuster consider obtaining a non-waiver agreement? - ANSWER-In dealing with a potential coverage dispute In coverage dispute situations, an adjuster may want to make clear that a known right is NOT being waived by any party. Mr. Vickers was in a hurry to catch a plane. He parks his car in the parking garage at the airport and leaves the keys in the ignition. When he returns he finds that his car has been stolen. Later the car was discovered with severe collision damage. The airport carries Garagekeeper's Legal Liability coverage and Mr. Vickers carries Liability and Comprehensive coverage on his auto. What coverage would apply? - ANSWER-Mr. Vickers' Comprehensive coverage (Other Than Collision). . This is an example of an "Other Than Collision" loss, sometimes referred to as Comprehensive. Even though the vehicle was involved in a collision the theft coverage would respond since the damage originated from the theft of the vehicle. When an insurer intends to non-renew a homeowners policy in New York, at least _____ advance notice of non-renewal must be sent to the insured. - ANSWER-45 days In New York, an insurer settling total auto losses must report the losses to: - ANSWER-The Department of Financial Services. The Department of Financial Services of New York requires that insurers settling a total auto loss, report the loss information upon completion of the claim. If any person engages in activities in violation of the Federal Insurance Fraud and False Statements regulation, he or she may be subject to which of the following? - ANSWER-A civil penalty of not more than $50,000 Subrogation may follow which of the following events? - ANSWER-An insured collects from her insurance company for damages caused by a third party. . First party claims refer to the insured. The second party is the insurance company. The third party is one claiming damage or injury by the insured or is the party who caused injury or damage to the insured. The company can seek reimbursement from a third party that caused the loss to the first party. Richard has been advised by the New York Superintendent of Insurance to cease and desist in the performance of certain infractions of the Insurance Code. He has had a hearing and been issued a cease and desist order. He continues to violate the cease and desist order. He can be fined a penalty of up to: - ANSWER-Richard is subject to a penalty of up to $5,000 for each violation.