RI Adjuster Practice Exam Questions With 100% Correct Verified Answers, Exams of Advanced Education

Download RI Adjuster Practice Exam Questions With 100% Correct Verified Answers and more Exams Advanced Education in PDF only on Docsity! RI Adjuster Practice Exam Questions With 100% Correct Verified Answers Which of the following phrases BEST defines a hazard? A. The uncertainty of a loss B. The cause of a loss C. An unexpected loss D. A condition that increases the chance of a loss - D A family takes their 50-horsepower outboard motor boat to the lake on a trailer towed behind their personal auto. The pleasure boat is appropriately covered for physical damage under which of the following policies? A. Dwelling B. Homeowners C. Boat owners D. Yacht - C Which of the following perils is covered by Broad Form perils but not covered by the Basic Form? A. Vandalism B. Weight of ice and snow C. Riot D. Sinkhole collapse - B G insures G's television repair shop under a Building and Personal Property Coverage Form with limits of $100,000 on the building and $50,000 on business personal property. A fire causes $10,000 in damage to the building and $20,000 in losses to the contents. G also has to pay $1,000 for debris removal. If the policy has as deductible of $250, G will receive a MAXIMUM of which of the following amounts from the insurer? A. $29,750 B. $30,000 C. $30,750 D. $31,000 - C Which of the following statements about a mortgagee's rights under the Dwelling Property Basic Form (DP-1) is INCORRECT? A. No act by the insured will jeopardize the mortgagee's rights B. The mortgagee may file a Proof of Loss if the insured fails to do so C. The mortgagee is entitled to receive prior notice of a policy's cancellation D. The mortgagee may abandon the insured property to the insurer. - D A company's promise to pay for damage caused by or resulting from any covered Cause of Loss would be found in which of the following sections of a Commercial Property policy? A. Declarations B. Insuring Agreement C. Conditions D. Exclusions - B 1. Which of the following businesses would be eligible for a Business owner's policy? A. Auto body shop B. Theater C. Branch bank D. Barber shop - D A primary obligation of an insurer is to: A. Pay the claims covered under the policy B. Provide a financial statement with each policy C. Make inspections and surveys of insured property D. Prepare an inventory after a loss - A All of the following options are examples of insurable interest EXCEPT: A. A person's interest in property she is buying on contract B. A tenant's interest in improvements she has made to a leased building C. A TV repairman's interest in a customer's TV which has been repaired but is still on premises D. An individuals' interest in property her parents will someday leave to her - D X insures a home for $100,000 under a Dwelling Property Broad Form (DP-2) If a flood causes $1,000 in damage to the home's contents, which of the following MAXIMUM amounts will X's insurer pay? A. $800 B. $0 C. $900 D. $1,000 - B Which of the following sources may be used to provide property insurability information? A. Police Records B. Physical inspections C. Checking account statements D. Lie detector tests - B Which of the following terms BEST describes continuous and repeated exposure to conditions that are neither expected nor intended by the insured? A. Negligence B. Liability C. Accident D. Occurrence - D In order to issue a written binder for a commercial property policy, what is the MINIMUM consideration a producer must secure from an applicant? B. Extra Expense C. Temporary housing expense D. Car rental expense - B Actual cash value is most often defined as which of the following options? A. Replacement cost less depreciation B. Amount paid less depreciation C. Fair market value plus appreciation D. Appraised value - A Pro-rata cancellation occurs when: A. A policy is nonrenewed B. A mortgage has been satisfied C. An insured cancels a policy at inception D. An insurer cancels a policy - D An applicant's statement included in the insurance contract that the property to be insured has an operable sprinkler system is: A. Agency binding authority B. A warranty C. A representation D. An affidavit - B The procedure for resolving a disagreement between an insured and insurer about a loss is described in which of the following parts of an insurance policy? A. Declarations B. Insuring Agreement C. Conditions D. Exclusions - C An insured owns a set of six drawing pens designed and used by Benjamin Franklin. Each pen is worth $1,000 alone, but the set is worth $12,000. One pen is destroyed by a covered peril. Under the Pair and Set clause, the insurer will pay a MAXIMUM of which of the following amounts? A. $1,000 B. $2,000 C. $7,000 D. $12,000 - C Which of the following perils is covered under the Commercial Property Basic Cause of Loss form: A. Collapse B. Sinkhole collapse C. Falling objects D. Breakage of glass - B The MAXIMUM amount of policy will pay in the event of a loss is called the: A. Coinsurance amount B. Deductible C. Limit of liability D. Pro rata return - C An insured's HO-2 Form has a $100,000 coverage limit on the dwelling and a $50,000 Personal Property limit with the standard deductible. If a sailboat valued at $1,500 is stolen from the insured's premises, the insured will collect a MAXIMUM of which of the following amounts? - B All of the following perils are covered under a Building and Personal Property Coverage Form with a Causes of Loss-Basic Form attached EXCEPT: A. Smoke B. Sprinkler leakage C. Sinkhole collapse D. Earth movement - D N's next-door neighbor, S, dumps hot ashes in N's trash dumpster, starting a fire and causing severe damage to N's home. N's company pays the loss and then goes after S for payment. This is an example of: A. Pro rata liability B. Assignment C. Appraisal D. Subrogation - D Which of the following Homeowners coverages does NOT generally contain a deductible? A. Personal Property B. Other structures C. Liability D. Dwelling - C In a Commercial Property form, if a building is left vacant, coverage for vandalism will continue for up to how many days? A. Thirty B. Forty-five C. Sixty D. Ninety - B The principle of indemnity is designed to avoid: A. Two policies sharing payment for a loss B. Overpayment of a claim C. The return of earned premiums D. A Coinsurance clause of less than 80 percent - B 1. An insured has an HO-3 Form. When using a snow blower borrowed from a neighbor, the insured strikes a large rock and causes $2,000 worth of damage to the snow blower. Under which section of the policy could payment be made on the insured's behalf? A. Personal Property B. Building C. Personal Liability D. Loss of Use - C Inland Marine insurance is commonly used to insure all of the following: A. Automobiles B. Stamps C. Camera equipment D. Jewelry - A 42. A Commercial Package policy must include at least how many coverage parts? A. FOUR B. TWO C. THREE D. ONE - B The owner-operator of a computer store often leaves expensive computers balanced negligently on the edges of tables, believing that any damage to the computers will be paid by the insurance policy. This situation is BEST described as a: A. Moral hazard B. Morale hazard C. Catastrophic hazard D. Psychological hazard - B Which of the following terms can be defined as a policy provision that omits certain risks from coverage? A. Declarations B. Insuring Agreement C. Conditions D. Exclusions - D S is purchasing a Commercial Property policy to cover a commercial building valued at $100,000. The policy includes an 80 percent Coinsurance clause. To avoid a coinsurance penalty in the event of a partial loss, S should purchase a policy with minimum limits of AT LEAST which of the following amounts? A. $100,000 B. $90,000 C. $80,000 D. $20,000 - C C. Conditions D. Exclusions - B If DEA breaks into a house and seizes drugs, we will cover what damages? A. Structure B. Contents C. Coverage will be excluded D. Personal property - C What is not considered direct evidence that an insured was speeding? A. Radar gun B. Statement of skid marks on site C. Testimony from a witness D. Admission of guilt - C What may be used to provide insurability info? A. Police report B. Insured statement C. Physical inspection D. References - B What statement best describes the principal of co-insurance? A. Multiple companies paying for a loss B. Insured paying part of a loss C. Insurance company paying for two losses D. Insured paying loss then collecting from insurer - B 65. A wrongful civil act best describes a: A. Risk B. Tort C. Crime D. Accident - B 51. Which of the following is not covered under comprehensive coverage: A. Hitting a bird B. Theft C. Collision with a tree D. Vandalism - C 51. When would a binder stop being in effect? A. When premium is collected B. When the policy becomes effective C. When insured sends written request D. When insurer decides to discontinue - B 51. A property that is considered a total loss and has a stated value policy, the MAXIMUM will be paid based on: A. Policy limits B. Actual Cash value C. Replacement Cost D. Reproduction Cost - A 51. How many days does an insurer have upon receiving notification of a claim to acknowledge that receipt? A. 30, B. 10, C. 7, D. 15 - B 51. In a 1st party claim, how many days does the insurer have to notify whether a claim has been accepted or denied? A. 30, B. 45, C. 10, D. 15 - D 51. Act of "voluntarily" neglecting, withholding information from policy can be described as: A. A warranty B. A misrepresentation C. Concealment D. A representation - B 51. How many days after the completion of repairs involving a 1st party claim must payment be issued? - B 51. If after a hearing the director finds that an insurer failed to cease and desist the insurer could be penalized as follows except: A.Assumption of Risk B. Vicarious Liability C. Proximate Cause D. Intervening Cause - B What are the four things included in every policy? A. Subrogation, loss, policy, exclusions B. Declaration, insuring agreement, conditions, exclusions C. Insuring agreement, conditions, definitions, loss D. Perils, hazards, definitions, conditions - B 51. At what time does a policy become effective? A. 12:00am B. 12:01am C. 12:00pm D. 12:01pm - B 51. If an insured passes information to an insurance agent, the insurance agent fails to pass all the information to the insurance company, at the time of loss A. Ins. company will be responsible for all info given to agent B. Ins. company will be liable for info passed from agent to Ins. company C. Agent will be responsible for partial loss D. Insured will be responsible for partial loss - A 51. If two homeowner policies apply at the same time, which one will pay if property is damaged? A. The limit of liability on both B. Equal payments from both parties C. The policy with the higher limits pays first, then the other policy applies D. They both pay what each policy is responsible for - B 51. What is the insured's report of date, time, and facts of loss called? A. Loss notice B. Accident Report C. Claim Report D. Proof of loss - A 51. Damages awarded in court for pain and suffering are called: A. Compensatory B. General C. Punitive D. Settlement - B 51. When property is damaged to a homeowner's house it is valued at (not endorsed): A. ACV B. Replacement Cost basis C. Market Value D. ACV less depreciation - B 51. When two or more policies or coverages apply to the same loss, the one that applies only after the limits of primary coverage have been exhausted is: A. Co-insurance B. Excess insurance C. Dual insurance D. Primary insurance - B 51. The type of liability that is imposed by law on those participating in certain activities that are considered especially hazardous is: A. Assumption of Risk B. Open Peril Policy C. "All risks" Policy D. Certain Perils Policy - a What is covered in a HO3 Policy that is not in a HO4 policy? A Personal Policy B. Dwelling C. Motorcycle D. Automobile - B If a guest were injured in your home what coverages would they qualify for under your homeowners policy? A Med pay only B. Personal liability only C. Both Personal and Med pay D. PIP - C A bird collides with your windshield and shatters it. What coverage would this loss fall under? A. Collision, less deductible B. Property damage C. Comprehensive D. Med pay - C 99. If an insured is struck in the rear and the other motorist is uninsured you would do the following? A. Deny Claim B. Pay under property damage C. Waive deductible for UMPD D. Pay under UMPD, less deductible - C The insurance commissioner is responsible for the following? A. Enforce insurance regulations B. Create insurance regulations C. Deny Claims D. Meeting once a month - A What is an example of Moral Hazard? A. Broken staircase B. Unlocked doors C. Embezzlement D. Rotting trees - C 99. What is the most important component of an adjuster's investigation? A. Calculator B. Tape measure C. Statements D. RI General Statutes - D Why is a release required? A. To pay the limit on the policy B. To release the insurance company from paying more than it wants to C. So the claim doesn't damage the insured's credit report D. So that it doesn't put the insured at risk for any further damages - D 99. What is the first thing you do for adjusting any property loss? A. Scope the loss B. Estimate C. Examine coverage D. Non-waiver agreement - C 99. Which HO policy covers the weight of snow? A. HO2 B. HO3 C. HO6 D. HO4 - A An employee of Brad's Plumbing starts a fire at the home of Mr. Joley's house while doing plumbing work. Which policy could not be used? A. Brad's Plumbing general liability policy B. Mr. Joley's homeowners policy C. Brad's plumbing workers comprehensive policy D. B&C - C Which of the following is not covered under comprehensive coverage? A. Contact with a bird or animal B. Theft/Vandalism C. Collision with another object D. Falling objects - C 99. Which of the following is not covered under comprehensive coverage? A. Contact with a bird or animal B. Theft/Vandalism C. Collision with another object D. Falling objects - C A warranty is a policy condition inserted by: A. The insurer B. The insured C. Both the insurer and the insured D. Either the insurer or the insured - D If a hurricane damages our home, what coverage applies? A. Hurricane storm B. Windstorm C. Fire D. Sandstorm - B 99. In the event of a loss under a Personal (Family) Auto Policy, an insured is required to submit to the insurance company all of the following information EXCEPT: A. Proof of Loss statement if requested B. Loss Notice C. Police Report D. An appraisal of the damaged property - D 99. A Commercial General Liability policy provides coverage for which of the following hazards? A. Professional Liability B. Employee Injury Liability C. Pollution Liability D. Contractual Liability - D In an application for marine insurance, a yacht owner stated that the yacht would only be sailed on inland waters. If the insured subsequently sails the yacht on the seas, coverage may be denied because the insured has breached what: A. The Inchmaree clause B. The policy clause C. A representation D. A warranty - D 99. Which of the following terms describes what is subtracted from a claim payment to the insured? A. Deductible B. Premium deduction C. Liability D. Salvage - A 99. In a state where minimum auto bodily injury liability limits are 20/40, Steve is driving with limits of 20/40. Steve is responsible for an accident with Tom in which Tom suffers bodily injury in the amount of $120,000. Tom has non-stacked Underinsured Motorists limits of 100/300. How much will Tom's policy pay toward Tom's injuries? A. $20,000 B. $80,000 C. $100,000 D. $120,000 - C An attempt to restore an insured to the insured's previous financial condition before the loss occurred is BEST described as: A. Owners and Contractors Protective Liability B. Premises and Operations Liability C. Professional Liability D. Products and Completed Operations Liability - C Premium cost for standard Workers Compensations insurance are paid by: A. Employers only B. Employees only C. Employers and employees jointly D. The Workers Compensation Board - A 99. Which of the following coverages would be BEST suited for a prospective insured that wants coverage against liability assumed by written and oral agreements. A. Products and Completed Operations Liability B. Contractual Liability C. Fidelity Bond D. Premises and Operations Liability - B In a state where minimum auto liability limits are 25/50/10, Underinsured Motorists coverage provides protection when the other driver: A. Has no insurance and is responsible for $18,000 in bodily injury B. Has limits of 15/30/10 and causes $18,000 in bodily injury C. Has limits of 25/50/10 causes $28,000 in bodily injury D. Has limits of 25/50/10 and causes $18,000 in bodily injury - C An insurance binder is best described as: A. A large bound volume of rules, rates, and forms B. A rate manual supplied by one of the rating organizations C. A temporary agreement to pay a claim pending final settlement D. Temporary short-term evidence of coverage - D Which of the following situations would be covered under Bodily Injury Liability coverage? A. Physical impairment B. False arrest C. Libel D. Suicide - A Under a Commercial General Liability policy, Personal and Advertising Injury Liability coverage does NOT apply to damages resulting from: A. Slanderous statements made by an advertising firm B. Copyright infringement by a department store C. Harmful, truthful information published by a Realtor D. Invasion of individual's privacy - C Which of the following losses would be covered under a Robbery and Safe Burglary Form? A. Valuable papers kept in a locked safe are destroyed by fire B. Cash is stolen from a locked safe that shows no signed of forced entry C. Jewelry is stolen from a locked safe that shows no signs of forced entry D. Gold bars stolen from a locked safe that shows signs of forced entry - D 99. Which of the following statements BEST describes a representation in an insurance application? A. It is a statement made by the insured that certain conditions exist at the time of application B. It is a promise made by the insured that certain conditions will continue to exist throughout the policy term C. It explains the promises of the insurance company D. It is part of the Insuring Agreement - A Which of the following occurrences would be included under the definition of a personal injury? A. A customer injured in a department store when a sign falls on her sues the store for medical costs and pain and suffering B. An employee injured lifting a heavy carton sues his employer for cost. C. An individual fired from her job sues her employer for unemployment benefits. D. A tenant evicted by his landlord sues the landlord for invasion of privacy and wrongful eviction - A 99. Which of the following individuals is NOT considered to be a custodian? A. Employee B. Janitor C. Partner D. Insured - B Which of the following vehicles is considered a covered auto under a Personal (Family) Auto Policy? A. A vehicle used by the insured to transport passengers to and from an airport for a fee B. The insured's all-terrain vehicle with three wheels C. A replacement car purchased by the insured a week ago but not yet reported to the insurance company D. A company car provided to the insured by an employer - C 99. Which of the following types of policies will cover a contractor's employees for injuries sustained on the job? A. Workers Compensation B. Owners and Contractors Protective Liability C. Commercial General Liability D. Premises and Operations Liability - A In a liability policy, Additional (Supplementary) Payments provide coverage for which of the following type of costs? A. Defense costs B. Medical expenses C. Loss of rental income D. Loss of use payment - A A prospective insured wishes to protect her firm against criminals taking money from a messenger going from the firm to a bank. In this situation, the prospect should purchase coverage for A. Fidelity B. Robbery C. Surety D. Burglary - B Which of the following exposures is covered under the basic Commercial General Liability policy? A. Injury caused by the insured's airplane B. Damages caused by products after their sale C. Injury to an employee of the insured D. Damage to others by assault - B After a collision loss, an insurance company may elect to pay the insured's claim and take possession of the vehicle. This practice is referred to as: A. Subrogation B. Salvage C. Warranty D. Deductible - B Which of the following individuals is likely to have a valid Workers Compensation claim? A. An employer B. An employee C. A subcontractor D. A creditor - A 99. An insured may cancel a Personal (Family) Auto policy by taking which of the following actions? A. Paying the insurance company any past due premiums B. Waiting until the policy expiration date C. Giving written notice to the insurance company D. Informing the agent by telephone - C 99. During a catastrophe how many days can a state issue a temporary license for? A. 15 B. 30 C. 60 An individual appointed by an insurer to solicit applications for a policy of insurance or to negotiate a policy on its behalf is known as: A. An adjuster B. A consultant C. An insurance broker D. An insurance producer - D An insurer that generally fails to affirm or deny coverage of claims within a reasonable period of time after receiving Proof of Loss may be found guilty of: A. A breach of fiduciary responsibility B. An unfair claims practice C. Defamation D. Misrepresentation - B Which of the following persons is EXEMPT from insurance licensing requirements? A. Claims adjuster B. Motor Vehicle damage appraiser C. A clerical worker in an insurance agency D. An insurance producer - C Which of the following situations is considered an insurance transaction? A. Claims adjuster B. Motor Vehicle damage appraiser C. A clerical worker in an insurance agency D. An insurance producer - C 99. Which of the following situations is considered an insurance transaction? A. Two insurance companies share actuarial data B. Two parties negotiate the term of coverage when executing an insurance contract. C. An independent audit company reviews a domestic insurer's records for a fee. D. An insured sends a policy to the bank in preparation for mortgage closing. - B Upon determining that a producer has violated the insurance law, the Insurance commissioner is required to take which of the following actions? A. Place the licensee on probation immediately B. Publish notice of the violation C. Hold a hearing on the infraction D. Submit the infraction to the Department of Insurance for review - C Making false or misleading statement about dividends or shares of surplus previously paid on an insurance policy is known as: A. Unfair discrimination B. Rebating C. Coercion D. Misrepresentation - D Controlled business includes insurance procured by insurance producers on the: A. Property or risks of insurance accounts they have had for at least three years B. Property of risks of relatives other than their spouse C. Property of their employer D. Property of their friends - C The Insurance Commissioner may suspend, revoke, or deny a producer's license for all of the following reason EXCEPT: A. Untrue statements on the license application B. Conviction of a misdemeanor C. Incompetence D. Converting funds - B 99. XYZ Insurance Company recently received its certificate of authority to sell property insurance in Illinois. XYZ is an Iowa insurer but will sell its products through its licensed Illinois producers. Which of the following statement is CORRECT about XYZ Company's involvement in the FAIR plan? A. XYZ may not join the FAIR plan, because it is a foreign company B. XYZ may not join the FAIR plan because it's producers are licensed in Illinois C. XYZ must belong to the FAIR plan because it has a certificate of authority to sell homeowners insurance D. Membership in the FAIR plan is optional for XYZ - C 99. If an owner-occupied dwelling is totally destroyed without criminal fault on the part of the insured, the amount of the loss covered by a property policy would be based on: A. A depreciated value of the dwelling B. The policy limits C. The market value of the dwelling D. The assessed value of the dwelling - B After an insurer receives a satisfactory proof of loss from an insured on a homeowner fire loss, payment is due within a MAXIMUM of how many days? A. 5 B. 30 C. 60 D. 90 - A The purpose of the FAIR plan is to provide: A. Automobile insurance for high-risk drivers B. Crime insurance for residents of high-risk neighborhoods C. Property insurance on recreational vehicles for which such coverage is unavailable in the regular market D. Basic property insurance for which coverage is not available in the regular market - D 99. According to the Nationwide Marine Definition as adopted in this state, which of the following structures may be written under an Inland Marine insurance form? A. Occupied dwellings B. Bridges and piers C. Oceangoing hulls D. Warehouses - B If a commercial insurer fails to meet the requirements of the 45 days Notice of Non- renewal Rule prior to the expiration date of the existing policy, the company MUST: A. Extend the current policy for one year and waive the premium B. Reduce the coverage to develop a new premium that does not exceed the expiring policy's premium C. Provide a renewal policy that matches the expiring policy's coverages and premium D. Pay a $3,000 fine per violation to the Division of Insurance - C To obtain coverage from this state's FAIR plan, an applicant MUST: A. Show that a diligent search was made through established markets B. Apply at least thirty days prior to the desired effective date of the coverage C. Pay a premium surcharge based on the applicant's past claims experience D. Pay a premium surcharge based on the type of property to be insured - A 99. Coverage of goods in transit is usually provided by which o the following types of insurance? A. Casualty B. Surety C. Inland Marine D. Automobile - C In this state, a domestic insurer is defined as a company that: A. Operates in this state but is incorporated in another state B. Operates in this state but is domiciled in another state C. Is headquartered in this state D. Is incorporated in this state - D The insured has liability, uninsured motorist, comprehensive coverage, and collision coverage. The vehicle in front of the insured vehicle kicked up a rock and hit the windshield. What coverage would the damages be paid under? A. Comprehensive coverage B. Collision coverage C. Liability D. Uninsured motorist - A A document attached to an insurance policy that changes the policy in some way is known as: A. An endorsement