Page | 1
TEXAS ALL LINES ADJUSTER TEST
QUESTIONS WITH DETAILED VERIFIED
ANSWERS
Accumulated Depreciation Ans: The total decrease in an item's value
over a period of time. Formula: (Annual Depreciation x Number of years
used)
Acreage Reporting Date Ans: The deadline for providing the insurer with
an acreage report, which is used to determine the amount of coverage
needed and the premium charged for a particular crop.
Actual Cash Value (ACV) Ans: A valuation method used by insurers to
reflect an item's current market value right before being damaged or
destroyed. Formula: (Replacement cost - Accumulated Depreciation)
Actual Production History Ans: A history of a farmer's crop yields over a
multi-year period, which is used to determine the normal production level
of a farm.
Adhesion Ans: Characteristic of an insurance contract. Means that one
party (the insurer) sets the terms, and the other (the policyholder) can
"take it or leave it."
Adjusted Gross Revenue (Crop Insurance) Ans: Narrowest (and least
expensive) form of Crop Revenue Insurance. Insures farm revenue as a
whole instead of individual crops. Guarantees a percentage of the insured
farm's average revenue.
Adjuster Ans: An agent who, for compensation, processes insurance
claims. Can represent either the insured or the insurer.
Adjuster - Emergency Ans: Adjusters who are temporarily licensed by
the insurance commissioner to handle claims during catastrophes or
emergencies that produce an overwhelming number of claims in a short
period of time.
, Page | 2
Adjuster - Independent Ans: Self-employed adjusters who contract with
multiple insurers at the same time. Paid on a commission or fee-plus-
expenses basis for each claim. Also called: Fee Adjuster, Bureau Adjuster
Adjuster - Public Ans: An adjuster who is hired to represent the claimant
and help determine a fair indemnification. Usually specializes in
appraisals and negotiation. Paid commission, usually a percentage of final
settlement.
Adjuster - Staff Ans: Salaried employee of one insurance company who
can work locally, regionally, or nationally. Also called: Company Adjuster
Advance Payment Settlement Ans: A settlement option that lets the
insurer offer some financial relief to the claimant before the claim has
been fully settled. The insurer makes advance payments to the claimant,
which are then subtracted from the final settlement amount. Often used
when a claimant suffers bodily injury and is unable to work.
Agency Authority Ans: The Agent's authority to act on behalf of
someone else, usually an insurer. This authority is derived from the
agent's contract with the insurer.
Agency Authority - express Ans: Authority that is expressly given to the
agent in writing. Allows agent to act on behalf of the principal.
Agency Authority - implied Ans: Authority that an agent possesses by
implication of her behavior, regardless of whether this authority is
granted in writing.
Agency Authority - apparent Ans: Authority that an agent possesses
based on the appearance of representing the insurer.
Agent Ans: Someone who has received authority from an insurer to sell
or service insurance policies.
Aggregate Limit Ans: A type of policy limit found in some health,
liability, and property damage policies. It represents the total amount the
insurer will pay for all losses (as opposed to an occurrence limit, which
denotes the total amount the insurer will pay per occurrence).
, Page | 3
Agreement Ans: One of the four requirements of a legally binding
contract. All parties involved must agree to the terms of the contract.
Can also refer to a binder, which is the preliminary substance of a
contract.
Agricultural Producer Ans: A business that grows, harvests, and sells
crops for profit.
Aleatory Ans: A characteristic of an insurance contract. Means
"depending on an unknown future event." An insurance contract will only
pay IF and WHEN covered damages occur. Neither party knows how
much the contract will end up paying when they enter into the contract.
Answer Ans: In liability cases, the defendant's response to a complaint.
There are three possible answers: 1) accept complaint and pay for
damages, 2) deny the complaint, or 3) accept the complaint with a right
to insert evidence into the case.
Annual Depreciation Ans: An item's Replacement cost divided by the
number of years in its expected lifespan.
Appraisal Ans: A negotiation method which allows the claimant and the
insurer each to select an appraiser. The two appraisers in turn select an
Umpire. The appraisers then work together to determine a settlement
amount. If they cannot agree, the Umpire steps in. Agreement by any
two of the three is binding.
Arbitration Ans: A negotiation method in which the opposing parties
each submit their evidence to a mutually-agreed-upon and neutral third
party, called an arbitrator. The arbitrator reviews the positions of each
opposing side, and makes a final and legally binding decision.
Arbitrator Ans: The mutually-agreed-upon and neutral third party in an
arbitration who reviews the positions of each opposing side, and makes a
final and legally binding decision.
Artificially Generated Current Ans: Also called "artificial current." A peril
covered in some property insurance policies. It includes sudden and
accidental damage from any electrical current, except currents that are
naturally generated, such as lightning or static electricity.
TEXAS ALL LINES ADJUSTER TEST
QUESTIONS WITH DETAILED VERIFIED
ANSWERS
Accumulated Depreciation Ans: The total decrease in an item's value
over a period of time. Formula: (Annual Depreciation x Number of years
used)
Acreage Reporting Date Ans: The deadline for providing the insurer with
an acreage report, which is used to determine the amount of coverage
needed and the premium charged for a particular crop.
Actual Cash Value (ACV) Ans: A valuation method used by insurers to
reflect an item's current market value right before being damaged or
destroyed. Formula: (Replacement cost - Accumulated Depreciation)
Actual Production History Ans: A history of a farmer's crop yields over a
multi-year period, which is used to determine the normal production level
of a farm.
Adhesion Ans: Characteristic of an insurance contract. Means that one
party (the insurer) sets the terms, and the other (the policyholder) can
"take it or leave it."
Adjusted Gross Revenue (Crop Insurance) Ans: Narrowest (and least
expensive) form of Crop Revenue Insurance. Insures farm revenue as a
whole instead of individual crops. Guarantees a percentage of the insured
farm's average revenue.
Adjuster Ans: An agent who, for compensation, processes insurance
claims. Can represent either the insured or the insurer.
Adjuster - Emergency Ans: Adjusters who are temporarily licensed by
the insurance commissioner to handle claims during catastrophes or
emergencies that produce an overwhelming number of claims in a short
period of time.
, Page | 2
Adjuster - Independent Ans: Self-employed adjusters who contract with
multiple insurers at the same time. Paid on a commission or fee-plus-
expenses basis for each claim. Also called: Fee Adjuster, Bureau Adjuster
Adjuster - Public Ans: An adjuster who is hired to represent the claimant
and help determine a fair indemnification. Usually specializes in
appraisals and negotiation. Paid commission, usually a percentage of final
settlement.
Adjuster - Staff Ans: Salaried employee of one insurance company who
can work locally, regionally, or nationally. Also called: Company Adjuster
Advance Payment Settlement Ans: A settlement option that lets the
insurer offer some financial relief to the claimant before the claim has
been fully settled. The insurer makes advance payments to the claimant,
which are then subtracted from the final settlement amount. Often used
when a claimant suffers bodily injury and is unable to work.
Agency Authority Ans: The Agent's authority to act on behalf of
someone else, usually an insurer. This authority is derived from the
agent's contract with the insurer.
Agency Authority - express Ans: Authority that is expressly given to the
agent in writing. Allows agent to act on behalf of the principal.
Agency Authority - implied Ans: Authority that an agent possesses by
implication of her behavior, regardless of whether this authority is
granted in writing.
Agency Authority - apparent Ans: Authority that an agent possesses
based on the appearance of representing the insurer.
Agent Ans: Someone who has received authority from an insurer to sell
or service insurance policies.
Aggregate Limit Ans: A type of policy limit found in some health,
liability, and property damage policies. It represents the total amount the
insurer will pay for all losses (as opposed to an occurrence limit, which
denotes the total amount the insurer will pay per occurrence).
, Page | 3
Agreement Ans: One of the four requirements of a legally binding
contract. All parties involved must agree to the terms of the contract.
Can also refer to a binder, which is the preliminary substance of a
contract.
Agricultural Producer Ans: A business that grows, harvests, and sells
crops for profit.
Aleatory Ans: A characteristic of an insurance contract. Means
"depending on an unknown future event." An insurance contract will only
pay IF and WHEN covered damages occur. Neither party knows how
much the contract will end up paying when they enter into the contract.
Answer Ans: In liability cases, the defendant's response to a complaint.
There are three possible answers: 1) accept complaint and pay for
damages, 2) deny the complaint, or 3) accept the complaint with a right
to insert evidence into the case.
Annual Depreciation Ans: An item's Replacement cost divided by the
number of years in its expected lifespan.
Appraisal Ans: A negotiation method which allows the claimant and the
insurer each to select an appraiser. The two appraisers in turn select an
Umpire. The appraisers then work together to determine a settlement
amount. If they cannot agree, the Umpire steps in. Agreement by any
two of the three is binding.
Arbitration Ans: A negotiation method in which the opposing parties
each submit their evidence to a mutually-agreed-upon and neutral third
party, called an arbitrator. The arbitrator reviews the positions of each
opposing side, and makes a final and legally binding decision.
Arbitrator Ans: The mutually-agreed-upon and neutral third party in an
arbitration who reviews the positions of each opposing side, and makes a
final and legally binding decision.
Artificially Generated Current Ans: Also called "artificial current." A peril
covered in some property insurance policies. It includes sudden and
accidental damage from any electrical current, except currents that are
naturally generated, such as lightning or static electricity.
