California Adjuster PSI Exam 200 Questions and
VERIFIED Answers (100% Correct Answers)
2023-2024 ANSWERS WITH EXPLANATIONS
ALREADY GRADED A
Which of the following is not a duty of an insurer in case of a loss?
Conduct a thorough investigation
Establish claim procedures and methods of documentation
Acknowledge receipt of a claim in a timely fashion
Separate the damaged property from the undamaged property and protect the property
from further loss - ANSWER>>The correct answer is: Separate the damaged property
from the undamaged property and protect the property from further loss.
EXPLANATION:
The insurance company is not required to separate the damaged property from the
undamaged property nor to protect the property from further loss. This is the
responsibility of the insured.
Which of the following statements is true about "additional coverages" in most insurance
policies?
They are included at no extra cost.
They are automatically included only when the loss is less than a deductible.
They are included for a minimum premium.
They are optional on the part of the insured. - ANSWER>>The correct answer is: They
are included at no extra cost.
EXPLANATION:
Examples of "additional coverages" would be debris removal and reasonable repairs
which are automatically included in most property forms.
Which of the following are are essential if a salvage award is to be made?
I. The property involved must be in peril from some hazard.
II. The salvage service must be voluntary.
III. The effort must be successful.
I and III only
I and II only
I, II and III
,II and III only - ANSWER>>The correct answer is: I, II and III
EXPLANATION:
All of these are essential if a salvage award is to be made.
The endorsement for water that backs up through a sewer or drain including mechanical
breakdown of a sump pump contains which of the following?
A separate stated limit of coverage
A separate stated deductible for covered losses
Both answers are correct
Neither answer is correct - ANSWER>>The correct answer is: Both answers are
correct.
EXPLANATION:
The endorsement will set a limit of coverage per occurrence for these losses and also
impose a stated deductible, which could be less than or greater than the standard
deductible for property losses stated on the declarations page. Both the coverage limit
and the deductible vary based on each insurer's underwriting guidelines.
All of the following are duties of an insured when filing a claim, EXCEPT:
Providing an adjuster to investigate the claim.
Providing a proof of loss statement.
Preserving the undamaged property to the best of his/her ability to avoid additional loss.
Full cooperation in providing the insurance company with all relevant books and
records. - ANSWER>>The correct answer is: Providing an adjuster to investigate the
claim.
EXPLANATION:
It is the duty of the insurer to investigate the claim. The insured is not obligated to obtain
an adjuster. If there is a dispute, the insured has the option of retaining an attorney or
hiring a public adjuster.
If a contractor does not properly protect a job site, another person could be injured. This
is an example of:
Negligence
A tort
A civil wrong
All of the responses are correct - ANSWER>>The correct answer is: All of the
responses are correct
EXPLANATION:
All of the responses are correct and is the purpose of the coverage provided by the CGL
policy.
,Under the "regular program" a flood insurance policy will insure a single family
residence for up to:
$250,000.
$35,000.
$100,000.
$185,000. - ANSWER>>The correct answer is: $250,000.
EXPLANATION:
The limit under the regular flood program is $250,000. Under the emergency flood
program the dwelling is covered for only $35,000.
The BOP is designed to cover all of the following, EXCEPT:
An office complex with 7,500 square feet in total floor area.
Small apartment houses.
Medium size clothing stores.
Gas stations. - ANSWER>>The correct answer is: Gas stations.
EXPLANATION:
The list of eligible risks for the BOP is rather narrow. Gas stations, garages and repair
shops would not qualify.
When is a self-insured retention applied in an umbrella policy?
When the umbrella policy covers a liability claim excluded by primary policies
When the umbrella responds to a claim
When the umbrella provides property coverage excluded by primary policies
There are no self-insured retentions in umbrella policies - ANSWER>>The correct
answer is: When the umbrella policy covers a liability claim excluded by primary
policies.
EXPLANATION:
Umbrella policies may cover a liability claim which is excluded by primary liability
policies; in those cases, the umbrella imposes a self-insured retention.
For an injured employee to receive temporary disability compensation for the first three
days of disability, the disability period must extend beyond how long?
14 days
21 days
One month
60 days - ANSWER>>The correct answer is: 14 days.
EXPLANATION:
, Total disability compensation for the first three days of disability is not payable unless
the disability continues for more than 14 days.
An attorney will provide notice of deposition to an individual when the attorney wishes to
secure from that individual:
A recorded statement under oath.
Any form of statement.
A written statement.
A feeling for how he or she will appear as a witness. - ANSWER>>The correct answer
is: A recorded statement under oath.
EXPLANATION:
A notice of deposition is essentially a subpoena which directs an individual to appear
and provide testimony under oath and on record at a location named (generally not in a
court room).
Which of the following is the term used to describe the determination by a health benefit
plan, based on the information presented at the time by the health care provider, that
health care services proposed by the health care provider are medically necessary.
Notification of claim
Claim investigation
Verification of eligibilty
Preauthorization/precertification - ANSWER>>The correct answer is:
Preauthorization/precertification
EXPLANATION:
The question provides you with the definition of preauthorization/precertification.
Which of the following is true regarding the amount of subrogation by an insurance
company?
The insurance company can subrogate only for the actual amount paid.
The insurance company can subrogate for the actual amount paid, plus the insured's
deductible.
The company can subrogate for any amount authorized by the insured.
None of the responses listed are correct. - ANSWER>>The correct answer is: The
insurance company can subrogate for the actual amount paid, plus the insured's
deductible.
EXPLANATION:
The insurer is permitted to subrogate only for the actual amount paid in a loss plus the
insured's deductible if any.
VERIFIED Answers (100% Correct Answers)
2023-2024 ANSWERS WITH EXPLANATIONS
ALREADY GRADED A
Which of the following is not a duty of an insurer in case of a loss?
Conduct a thorough investigation
Establish claim procedures and methods of documentation
Acknowledge receipt of a claim in a timely fashion
Separate the damaged property from the undamaged property and protect the property
from further loss - ANSWER>>The correct answer is: Separate the damaged property
from the undamaged property and protect the property from further loss.
EXPLANATION:
The insurance company is not required to separate the damaged property from the
undamaged property nor to protect the property from further loss. This is the
responsibility of the insured.
Which of the following statements is true about "additional coverages" in most insurance
policies?
They are included at no extra cost.
They are automatically included only when the loss is less than a deductible.
They are included for a minimum premium.
They are optional on the part of the insured. - ANSWER>>The correct answer is: They
are included at no extra cost.
EXPLANATION:
Examples of "additional coverages" would be debris removal and reasonable repairs
which are automatically included in most property forms.
Which of the following are are essential if a salvage award is to be made?
I. The property involved must be in peril from some hazard.
II. The salvage service must be voluntary.
III. The effort must be successful.
I and III only
I and II only
I, II and III
,II and III only - ANSWER>>The correct answer is: I, II and III
EXPLANATION:
All of these are essential if a salvage award is to be made.
The endorsement for water that backs up through a sewer or drain including mechanical
breakdown of a sump pump contains which of the following?
A separate stated limit of coverage
A separate stated deductible for covered losses
Both answers are correct
Neither answer is correct - ANSWER>>The correct answer is: Both answers are
correct.
EXPLANATION:
The endorsement will set a limit of coverage per occurrence for these losses and also
impose a stated deductible, which could be less than or greater than the standard
deductible for property losses stated on the declarations page. Both the coverage limit
and the deductible vary based on each insurer's underwriting guidelines.
All of the following are duties of an insured when filing a claim, EXCEPT:
Providing an adjuster to investigate the claim.
Providing a proof of loss statement.
Preserving the undamaged property to the best of his/her ability to avoid additional loss.
Full cooperation in providing the insurance company with all relevant books and
records. - ANSWER>>The correct answer is: Providing an adjuster to investigate the
claim.
EXPLANATION:
It is the duty of the insurer to investigate the claim. The insured is not obligated to obtain
an adjuster. If there is a dispute, the insured has the option of retaining an attorney or
hiring a public adjuster.
If a contractor does not properly protect a job site, another person could be injured. This
is an example of:
Negligence
A tort
A civil wrong
All of the responses are correct - ANSWER>>The correct answer is: All of the
responses are correct
EXPLANATION:
All of the responses are correct and is the purpose of the coverage provided by the CGL
policy.
,Under the "regular program" a flood insurance policy will insure a single family
residence for up to:
$250,000.
$35,000.
$100,000.
$185,000. - ANSWER>>The correct answer is: $250,000.
EXPLANATION:
The limit under the regular flood program is $250,000. Under the emergency flood
program the dwelling is covered for only $35,000.
The BOP is designed to cover all of the following, EXCEPT:
An office complex with 7,500 square feet in total floor area.
Small apartment houses.
Medium size clothing stores.
Gas stations. - ANSWER>>The correct answer is: Gas stations.
EXPLANATION:
The list of eligible risks for the BOP is rather narrow. Gas stations, garages and repair
shops would not qualify.
When is a self-insured retention applied in an umbrella policy?
When the umbrella policy covers a liability claim excluded by primary policies
When the umbrella responds to a claim
When the umbrella provides property coverage excluded by primary policies
There are no self-insured retentions in umbrella policies - ANSWER>>The correct
answer is: When the umbrella policy covers a liability claim excluded by primary
policies.
EXPLANATION:
Umbrella policies may cover a liability claim which is excluded by primary liability
policies; in those cases, the umbrella imposes a self-insured retention.
For an injured employee to receive temporary disability compensation for the first three
days of disability, the disability period must extend beyond how long?
14 days
21 days
One month
60 days - ANSWER>>The correct answer is: 14 days.
EXPLANATION:
, Total disability compensation for the first three days of disability is not payable unless
the disability continues for more than 14 days.
An attorney will provide notice of deposition to an individual when the attorney wishes to
secure from that individual:
A recorded statement under oath.
Any form of statement.
A written statement.
A feeling for how he or she will appear as a witness. - ANSWER>>The correct answer
is: A recorded statement under oath.
EXPLANATION:
A notice of deposition is essentially a subpoena which directs an individual to appear
and provide testimony under oath and on record at a location named (generally not in a
court room).
Which of the following is the term used to describe the determination by a health benefit
plan, based on the information presented at the time by the health care provider, that
health care services proposed by the health care provider are medically necessary.
Notification of claim
Claim investigation
Verification of eligibilty
Preauthorization/precertification - ANSWER>>The correct answer is:
Preauthorization/precertification
EXPLANATION:
The question provides you with the definition of preauthorization/precertification.
Which of the following is true regarding the amount of subrogation by an insurance
company?
The insurance company can subrogate only for the actual amount paid.
The insurance company can subrogate for the actual amount paid, plus the insured's
deductible.
The company can subrogate for any amount authorized by the insured.
None of the responses listed are correct. - ANSWER>>The correct answer is: The
insurance company can subrogate for the actual amount paid, plus the insured's
deductible.
EXPLANATION:
The insurer is permitted to subrogate only for the actual amount paid in a loss plus the
insured's deductible if any.
