Adjusterpro Final Exam Questions And Answers
With Verified Solutions Already Passed!!!
,-+What is a reserve, in insurance terms? - ANSWER✔✔ A pool of collected premiums
that the insurer sets aside to pay claims
Which of these scenarios is NOT an example of indemnification? - ANSWER✔✔ When
trying to renew her dog's license, Ellen has to pay a penalty to the city for letting its
rabies vaccination lapse.
Ellen having to pay a fine is not an example of indemnification. Indemnification means
being restored to the financial condition you were in before a loss. In three of these
situations, someone experienced a loss and was then "made whole": Joe-Bob's
neighbor lost his TV, Alice lost her house, and Hugh lost the use of his car. But in
the case of Ellen's dog, the city did not experience a loss; it simply imposed a
penalty to teach Ellen a lesson about keeping up with her dog's shots.
Greg plays trombone in his school band during football games. During a rally song in the
stands one day, Greg annoys one of the opposing team's fans, who grabs his $400
trombone and hurls it down the bleachers, completely destroying it. Greg's
insurance pays him $400 to replace the trombone, but then the opposing team's
coach also offers to replace the instrument, at whatever the cost. So Greg orders a
new $3,200 trombone and has the opposing team's athletic department absorb the
cost. Which principle has Greg violated? - ANSWER✔✔ The principle of
indemnity
Which of the following statements is true about an insurance policy? - ANSWER✔✔ It
relies on the utmost good faith of both the insured and the insurer
,An insurance policy relies on the utmost good faith of both the insured and the insurer.
Which of the following would you find in the Conditions section of an insurance policy? -
ANSWER✔✔ The insured's duty after a loss
In which section of an insurance policy might you find the following statement? "Damage
to insured property must be reported within 15 days of the damaging occurrence."
- ANSWER✔✔ Conditions
A captive insurance company: - ANSWER✔✔ exists solely to provide insurance for its
parent company.
Cindy holds an insurance policy from Sine Nomine Insurance. This is not a publicly
traded company, and Cindy can participate in the election of the board, receiving
dividends if the company does well. Sine Nomine Insurance could be best
described as a: - ANSWER✔✔ Sine Nomine Insurance is a mutual insurance
company.
When an insurer issues an insurance policy, the actual item, person, or organization that
is being insured is called the: - ANSWER✔✔ risk.
Which of the following is a hazard? - ANSWER✔✔ A driver's tendency to text while
driving
Which of the following situations does NOT involve an insurable risk? - ANSWER✔✔
Dale just bought 30 shares of a hot new startup company online.
, Which of the following situations does NOT involve an instance of "pure risk?" -
ANSWER✔✔ Loss of money invested in the stock market
Which of the following is an insurable risk? - ANSWER✔✔ football stadium Risk
avoidance is a risk management technique that: - ANSWER✔✔ eliminates
risk.
Amy needs more floor space in her antique furniture store, so she buys a storage
building 3 miles away. She is worried about keeping the furniture in the storage
building safe, so she puts in an alarm system and smoke detectors. By purchasing
the alarm system and smoke detectors, Amy is practicing: - ANSWER✔✔ risk
reduction.
Six Stars Development Company has just been offered a great deal on ten large properties
in Las Vegas. The economy in Las Vegas has been declining recently, but the CEO
of Six Stars expects it to recover soon. This could be an exceptional opportunity for
Six Stars, but it's also pretty risky. Ultimately, the Six Stars executive team decides
not to purchase the properties. This is an example of: - ANSWER✔✔ risk
avoidance.
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? - ANSWER✔✔ An implied waiver is one that is assumed based on
someone's actions. When the insurer decided to accept Jason's late premium
payments, it implied that it was waiving its right to cancel Jason's policy because of
a late payment. So, when Jason files a claim, the insurer may not claim that his
policy is void due to late payments.
With Verified Solutions Already Passed!!!
,-+What is a reserve, in insurance terms? - ANSWER✔✔ A pool of collected premiums
that the insurer sets aside to pay claims
Which of these scenarios is NOT an example of indemnification? - ANSWER✔✔ When
trying to renew her dog's license, Ellen has to pay a penalty to the city for letting its
rabies vaccination lapse.
Ellen having to pay a fine is not an example of indemnification. Indemnification means
being restored to the financial condition you were in before a loss. In three of these
situations, someone experienced a loss and was then "made whole": Joe-Bob's
neighbor lost his TV, Alice lost her house, and Hugh lost the use of his car. But in
the case of Ellen's dog, the city did not experience a loss; it simply imposed a
penalty to teach Ellen a lesson about keeping up with her dog's shots.
Greg plays trombone in his school band during football games. During a rally song in the
stands one day, Greg annoys one of the opposing team's fans, who grabs his $400
trombone and hurls it down the bleachers, completely destroying it. Greg's
insurance pays him $400 to replace the trombone, but then the opposing team's
coach also offers to replace the instrument, at whatever the cost. So Greg orders a
new $3,200 trombone and has the opposing team's athletic department absorb the
cost. Which principle has Greg violated? - ANSWER✔✔ The principle of
indemnity
Which of the following statements is true about an insurance policy? - ANSWER✔✔ It
relies on the utmost good faith of both the insured and the insurer
,An insurance policy relies on the utmost good faith of both the insured and the insurer.
Which of the following would you find in the Conditions section of an insurance policy? -
ANSWER✔✔ The insured's duty after a loss
In which section of an insurance policy might you find the following statement? "Damage
to insured property must be reported within 15 days of the damaging occurrence."
- ANSWER✔✔ Conditions
A captive insurance company: - ANSWER✔✔ exists solely to provide insurance for its
parent company.
Cindy holds an insurance policy from Sine Nomine Insurance. This is not a publicly
traded company, and Cindy can participate in the election of the board, receiving
dividends if the company does well. Sine Nomine Insurance could be best
described as a: - ANSWER✔✔ Sine Nomine Insurance is a mutual insurance
company.
When an insurer issues an insurance policy, the actual item, person, or organization that
is being insured is called the: - ANSWER✔✔ risk.
Which of the following is a hazard? - ANSWER✔✔ A driver's tendency to text while
driving
Which of the following situations does NOT involve an insurable risk? - ANSWER✔✔
Dale just bought 30 shares of a hot new startup company online.
, Which of the following situations does NOT involve an instance of "pure risk?" -
ANSWER✔✔ Loss of money invested in the stock market
Which of the following is an insurable risk? - ANSWER✔✔ football stadium Risk
avoidance is a risk management technique that: - ANSWER✔✔ eliminates
risk.
Amy needs more floor space in her antique furniture store, so she buys a storage
building 3 miles away. She is worried about keeping the furniture in the storage
building safe, so she puts in an alarm system and smoke detectors. By purchasing
the alarm system and smoke detectors, Amy is practicing: - ANSWER✔✔ risk
reduction.
Six Stars Development Company has just been offered a great deal on ten large properties
in Las Vegas. The economy in Las Vegas has been declining recently, but the CEO
of Six Stars expects it to recover soon. This could be an exceptional opportunity for
Six Stars, but it's also pretty risky. Ultimately, the Six Stars executive team decides
not to purchase the properties. This is an example of: - ANSWER✔✔ risk
avoidance.
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? - ANSWER✔✔ An implied waiver is one that is assumed based on
someone's actions. When the insurer decided to accept Jason's late premium
payments, it implied that it was waiving its right to cancel Jason's policy because of
a late payment. So, when Jason files a claim, the insurer may not claim that his
policy is void due to late payments.
