ETHICS 101 PRACTICE EXAM 2| ALL CORRECT ANSWERS

ETHICS 101 PRACTICE EXAM 2According to the Mortgagee Clause, what is NOT one of the rights of the mortgagee? The mortgagee may change the coverage amount. After a covered accident, your PIP will provide coverage for all of the following, EXCEPT: medical costs for the driver you struck. Jason’s auto policy states that the insurer may cancel coverage if a premium is more than 30 days late. However, Jason is currently more than 30 days late, and has been so five times in the last year, and his insurer has done nothing about it. When Jason gets into an accident and files a claim, which of the following is most likely to happen? The insurer will pay the claim because of the implied waiver they have made by not cancelling Jason’s policy the previous times he was late with his payments. The Cancellation/Nonrenewal provision: requires the insurer to provide notice before cancelling a policy. Sam is a claimant seeking damages from XYZ Insurance. The XYZ adjuster comes to meet with Sam to hear the circumstances of her injury. The adjuster determines that Sam played an active role in her own injuries, and therefore XYZ Insurance will pay her nothing at all for her injuries. What defense is the adjuster using? Contributory negligence. In a Personal Auto Policy, the term “family member” would include: the names insured’s 26-year-old son who lives at home. Mark is driving along and looking for an address on the East side of Walker Street. As he squints to see the numbers posted on the buildings, he plows into the back of a car waiting at a stoplight. Both the driver and the passenger of the struck car are injured. The driver suffers $60,000 in bodily injury, the passenger suffers $55,000 in bodily injury, and the vehicle Mark hit sustains $30,000 in damage. Mark has liability coverage with split limits of 50/100/25. How much will Mark be responsible for out-of-pocket after this accident? $20,000. When we say that a claims file is “discoverable,” we mean that: the file can be used as evidence in a court case. Which of the following is not a necessary preliminary step for the adjuster who is entering negotiations? Speak with the claimant beforehand to get an idea of the minimum amount she will accept. Which endorsement to a garage-keepers policy would cover the theft of a vehicle by someone who was pretending to take it for a test-drive? False Pretense Coverage. The purpose of the principle of indemnity is: to prevent an insured from making a profit on a loss. In which section of the policy might you find the following statement? "Property Address: 246 Rosemead Drive." Declarations. Jim is out turkey hunting on a private ranch when he hears some movement in the brush. Assuming it’s a turkey, Jim raises his shotgun and fires. Unfortunately for Jim, he has not taken a turkey, but instead severely injured one of the landowner’s calves. The landowner decides to sue Jim for the cost of the calf. In the civil lawsuit that follows, the landowner would be the: plaintiff. At what point in the claims process might a Reservation of Rights letter be sent? At the beginning of the investigation. Which of the following statements best describes the Law of Large Numbers? The larger the number of units insured, the more accurately the insurer can predict the number of claims from that group. Which of the following activities would most likely not be a useful negotiation technique? Conceding to a claimant’s point that is an obvious ploy. Which of the following is NOT a characteristic of a full release settlement? The insurer pays for certain future “incidentals” related to the claim. Which of the following statements is FALSE? An agent always has a fiduciary duty to defend the claimant.