Louisiana Auto Adjuster Exam Questions With Verified Answers

diminished value - Answer a concept that states an automobile's market value has decreased, even though it's been repaired after an accident; occurs because of the theory that repairs can't be made to put the vehicle into its exact pre-loss condition market value - Answer a concept, which takes into account, what the property would sell for on the open marketplace; utilized frequently when selling property such as homes and auto agreed value - Answer the difference is that the agreed value provision states that it will not pay any amount other than what's shown in the schedule in the event of a total loss; this method of valuation is commonly used with items of significant value, such as jewelry or furs stated amount - Answer most often used in auto insurance; requires a limit of insurance to be listed for each vehicle; states that the insurer will pay the lesser of the actual cash value of the loss, the amount necessary to repair or replace with property of like kind and quality or the amount scheduled in the policy actual cash value - Answer a concept, which is based on the current cost new of the property at the time of loss, with a deduction for depreciation on the property; this value cannot exceed the limit of insurance on the property estoppel - Answer something is allowed to continue because all defenses against it are stopped waiver - Answer giving up of any known right or advantage reasonable expectations - Answer a rule regarding insurance policies; since policies can include complicated and technical language, many average consumers could not understand them aleatory - Answer the performance of the contract is based on chance, rather than certainty direct losses - Answer losses that occur when tangible property is damaged by a peril Insurance - Answer A means to transfer risk from one person or organization to a company, thereby allowing a sharing of losses among all the insured persons or organizations loss - Answer a reduction in quality, quantity or value of an asset risk - Answer chance or uncertainty of loss direct; indirect - Answer losses are considered either ________________ or ________________ morale hazards - Answer these hazards involve carelessness on the part of the insured moral hazards - Answer deal with situations that have the potential of creating false or fraudulent claims or dishonesty in general physical hazards - Answer characterized by anything that is tangible physical, moral, and morale - Answer what three specific categories are hazards broken down into? hazards - Answer anything that increases the chance that a loss will occur peril - Answer cause of loss 3rd party insurance - Answer if the loss was covered by the policy, then payment is made to the party that suffered the loss casualty insurance - Answer covers accidental losses resulting from bodily injury to a person or damage to the property of someone else for which the insured is legally responsible 1st party insurance - Answer if the loss is covered by the policy, the payment for the claim is made directly to the insured property insurance - Answer covers accidental losses resulting from damage to property of the insured premium - Answer the insured pays a ____________ to the insurer in exchange for the promise provided by the insurance contract to pay covered claims Insured - Answer A person, organization or business that is covered by an insurance policy consideration - Answer a valid contract must involve ______________ (something of value) from both parties; can consist of money, an act, a promise, or the giving up of a legal right Doctrine of Reasonable Expectations - Answer this means that if an insurer constructs the contract definitions in such a way as to substantially deviate from the accepted definition, then the commonly accepted definition with prevail adhesion - Answer refers to both parties being bound by the terms of the contract Only one party constructs the contract, with no input from the other; any ambiguity in the contract must be interpreted in factor of the party that had no input from the other utmost good faith - Answer each party must rely on the representations made by the other party and is acting in good faith with no attempt to conceal or commit fraud legal purpose - Answer a valid contract must have a __________ _________ and be consistent with public policy competent parties - Answer to be valid and enforceable, _______________ ____________ must enter into the contract