ACA Final Exam Questions with Complete Verified Solutions 2024/2025, Exams of Insurance law

Download ACA Final Exam Questions with Complete Verified Solutions 2024/2025 and more Exams Insurance law in PDF only on Docsity! ACA Final Exam Questions with Complete Verified Solutions 2024/2025 At the end of this course, you must do which of the following? Pass the final course exam with a scored of 70% or higher Print your certificate from this website Apply for your Insurance Adjuster license at the Florida Department of Financial Services website at www.myfloridacfo.com/division/agents All of the above All of the above Which of the following is NOT one of the duties of the Department of Financial Services? License adjusters Set rates and write policies for various company products Supervise the claims activity of adjusters Investigate charges of unethical conduct of adjusters Set rates and write policies for various company products When an insurance licensee moves, he has how long to notify the Florida Dept. of Financial Services of his change of address? 10 Days 30 Days 60 Days 180 Days 30 An Insurance Policy is a contract with all of the following characteristics, EXCEPT It is a personal contract. Parties are of unequal power with ambiguities or unclear wording resolved in favor of the insured because it is a contract of adhesion. Indemnity is not part of an insurance contract. There are conditions imposed upon both the insurer and insured. Indemnity is not part of an insurance contract. An insurance contract may contain a "gray area" or an ambiguity, that is generally resolved in favor of the insured because insurance policies are contracts of: Indemnity Cohesion Adhesion Conditions adhesion Strict or Absolute Liability applies to school systems. must have failure to use "due care. "considers the actions of a prudent person. is assigned by law or statute. is assigned by law or statute. Risks that are insurable are: Speculative risk Pure risk Both A & B None of the above Pure Risk The goal of insurance is to restore the insured to the same economic position as before the covered loss occurred, this is the principle of: Adhesion Actual Cash Value Indemnity Severability Two acres must be inundated with water - flooded.Loss to a detached garage would be settled on an actual cash value basis. To be insured for flood, a new building only must have the walls up. All of the following are EXCLUSIONS under a personal articles floater (Personal Inland Marine Policy) EXCEPT: Theft Deterioration of insured article Inherent vice - destruction contained within the object Losses caused by vermin or insects Theft Condominiums may be covered by both an Association (Commercial Condo) Policy and a Unit Owners' (Homeowners) Policy, which of the following is true? The Unit Owners' Policy is primary and the Association Policy is excess The Association Policy is primary and the Unit Owners' Policy is excess There never would be both an Association Policy and a Unit Owner's Policy on the same property at the same time None of the above statements are true The Association Policy is primary and the Unit Owners' Policy is excess A claimant ate some undercooked fish and got violently ill at the restaurant. Which of the following would pay for this occurrence? A products and completed operations form A premises and operations form An owner's and contractor's protective liability form A liquor liability form A premises and operations form Which of the following are covered exposures for bodily injury and property damage under the CGL (Commercial General Liability) Policy: Products and completed operations Contractual Liability Contingent Liability All of the above are available in the CGL policy All of the above are available in the CGL policy Under a CGL Occurrence liability form, which policy would cover an accident that occurred June 1, 1998, and was discovered and reported July 15, 2008: A policy dated 1/1/98 to 12/31/98 A policy dated 1/1/99 to 12/31/99 A policy dated 1/1/08 to 12/31/08 No policy would cover a claim filed in 2008 for an accident in 1998 A policy dated 1/1/98 to 12/31/98 A furniture manufacturing business wanted to serve free beer at its company picnic. What is required for this business to have liability coverage for liquor consumption at the picnic? The business CGL policy will cover this exposure The business CGL requires the liquor liability form in this case The business CGL should have the "extension of coverage" endorsementThere is no way liability for alcoholic beverages can be included under CGL The business CGL policy will cover this exposure Insurance agents and adjusters may have their professional activities covered under a type of liability insurance called: Owners Protective LiabilityEmployment Related Practices LiabilityMalpractice LiabilityErrors and Omissions Liability Errors and Omissions Liability The following are employees who must have workers compensation EXCEPT: Government employees Pro athletes Construction industry workers in companies with 1 employee Private employers with 4 or more employees Pro athletes All the following are components of the Workers Compensation EXCEPT: Unlimited death benefits Reimbursement for medical expenses incurred Replacement for lost wages on a percentage basis Funeral costs up to $7500 Unlimited death benefits What is the limit on medical benefits under Workers Compensation? 66 2/3 % of medical costs All medical costs with no limit All medical costs up to the $150,000 death benefit All medical costs up to the 100/100/500 employer liability limit All medical costs with no limit If an insured's administrative assistant fraudulently forged the insured's name on a check, and cashed it, which of the following would cover this event? Employee theft Forgery or alteration Robbery Premises burglary Employee theft Which of the following type of employee theft best fits a business with a large turnover in its personnel? The Name Schedule coverage The Basic Extended Reporting Period The Blanket coverage The firm should reduce its number of employees The Blanket coverage Insurance is considered a two-party contract, Surety Bonds are considered not a contractalso a two-party contract a three-party contract final payments a three-party contract The Surety attempts to avoid default by investigating the principal with regard to: CharacterCapabilityCollateralAll of the above All of the above A builder contracted for framing on a new section of a hospital. There is a surety bond purchased to guarantee completion of the project. Which of the following best describes the hospital position in the surety bond? Your insured has purchased the minimum split limit policy that meets Financial Responsibility Law in Florida. He causes the following bodily injuries to passengers: Carl $12,000 Jeanne $10,000 Charlie $10,000 How much will his policy pay? Nothing$10,000 each to all that were injured$20,000 for the total BI portion of accident$32,000 total for all injuries from Part A Liability $20,000 for the total BI portion of accident An insured has 25/50/25 limits and injured another person. The injured person won a tort claim for $30,000 against the insured and the insured's attorney charged $7,500 to defend the insured. How much is paid by the insured's insurance company? 0, since the insured was at-fault.$50,000, the policy limit.$37,500, the actual damages and the attorney's fees for defense.$32,500, the policy limit and the attorney's fees for defense $32,500, the policy limit and the attorney's fees for defense. An insured has $100 deductible Other Than Collision, and $250 deductible Collision. If a rock breaks his windshield and repairs total $675, how much will be paid? Payment only will be made if he is not at-fault$425, under Collision with a $250 deductible$575. under Other Than Collision, with a $100 deductible$675, under Other Than Collision, with no deductible $675, under Other Than Collision, with no deductible When searching for insurance solutions to pay for personal injuries from an auto accident, the order of payment in Florida in most cases, would be: PIP, Uninsured Motorist, Med Pay, LiabilityMed Pay, Uninsured Motorist, PIP, LiabilityPIP, Med Pay, Liability, Uninsured MotoristLiability, PIP, Med Pay, Uninsured Motorist PIP, Med Pay, Liability, Uninsured Motorist UM (Uninsured Motorist) coverage under the PAP (Personal Auto Policy) pays for: damage to the insured's car caused by hit and run driverbodily injury to the insured caused by hit and run driverinjury to a pedestrian caused by the insurednone of the above bodily injury to the insured caused by hit and run driver An insured took his TV to a shop for repairs, on the way, he stopped suddenly and the TV fell off the seat, breaking the TV. How will his PAP (Personal Auto Policy) respond? The PAP will pay ACV for the TV damage.The PAP will respond under physical damage section minus deductible.The PAP will pay Replacement Cost for the TV.The PAP will not respond. The PAP will not respond. In Section II of the Business Auto Policy, liability is available for: Named insured.Permissive operators of autos owned, hired or borrowed.Anyone insured is vicariously liable for.All of the above all of the above Which of the following is covered under the Garage Policy? Employee injuriesCustomer's property under the care, custody and control of the garageGarage locationProduct recall Garage location The Claims Adjuster's role in the insurance industry includes all the following EXCEPT: Facilitating payment of legitimate claimsReplies to communication on a claim within 14 calendar daysReplies to Department of Insurance inquires on a claim within 21 calendar daysGives appropriate legal advice and writes binding contracts Gives appropriate legal advice and writes binding contracts The adjuster has a particular relationship to his principal, the insurer. Which of the following best describes this relationship? It is a fiduciary relationship.It is a functional relationship.It is a final relationship.It is a funny relationship. It is a fiduciary relationship. Comparative negligence is determined through Investigation & AnalysisAgreement between parties or by mediation or arbitrationJudge and/or juryAll of the above may be used to determine comparative negligence All of the above may be used to determine comparative negligence An adjuster offered a claimant a settlement where the full payment would be presented and a release was signed. This is called a: Walk-away settlementA Full Release settlementA Rehabilitation settlementA Structured settlement A Full Release settlement Adjuster Jane moved from one city in Florida to another. What length of time does she have to notify the Insurance Department of the address change? 10 Days30 Days60 Days90 Days 30 days Bad Faith & Adjusting Practices - Under the Florida Unfair Trade Practices Act & the Unfair Methods of Competition and Unfair or Deceptive Acts, all of the following are prohibited, EXCEPT: Adjuster refuses to advise insured of reason claim denied in writingAdjuster denies a claim without reasonable investigationAdjuster keeps accurate records on a claimAdjuster settles a claim based on an altered application. Adjuster keeps accurate records on a claim Florida's Administrative Code contains a Code of Ethics for Adjuster - which of the following is FALSE? An adjuster shall not provide favored treatment to any claimantAn adjuster shall not advise a claimant to refrain from seeking legal adviceAn adjuster shall put the duty for fair and honest treatment of the claimant above the adjuster's own interestsAn Adjuster owes fair and prompt treatment to their own company's policyholders only An Adjuster owes fair and prompt treatment to their own company's policyholders only Which of the following is a duty owed to an invitee? land owner must make reasonable efforts to maintain property in safe conditioninvitee must maintain a care level typical of a reasonable personland owner does not owe any legal duties to an invitee - they are the same as trespassersNone of the above are true land owner must make reasonable efforts to maintain property in safe condition What is the difference between liability and coverage? there is no differencethey are not relatedliability is a legal doctrine and coverage is a contractual obligationcoverage is a legal obligation and liability is a legal obligation liability is a legal doctrine and coverage is a contractual obligation All of the following activities are illegal for an adjuster, EXCEPT: Give advice which is of a legal natureUse only company forms to prepare releasesEncourage a claimant to make a quick decision on an offer to settleFail to make claimant aware of potential litigation for claimant's actions Use only company forms to prepare releases An adjuster received written notice from the Department of Financial Services regarding a claim. What length of time does he have to respond to the inquiry? 10 calendar days14 calendar days21 calendar days30 calendar days 21 days Which of the following is NOT a goal in the adjusting process? comply with laws and contractcultivate good customer relations and policyholder retentioncontrol costsalways pay the maximum limit of the policy always pay the maximum limit of the policy Risk may be controlled by which of the following? Safety measuresPurchase of InsuranceRetention of risk (self insure)All of the above All of the above