Texas All Lines Adjuster Test Questions with Complete Solutions 2023, Exams of Nursing

Download Texas All Lines Adjuster Test Questions with Complete Solutions 2023 and more Exams Nursing in PDF only on Docsity! Texas All Lines Adjuster Test Questions with Complete Solutions 2023 Accumulated Depreciation - The total decrease in an item's value over a period of time. Formula: (Annual Depreciation x Number of years used) Acreage Reporting Date - 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) - 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 - 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 - 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) - 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 - An agent who, for compensation, processes insurance claims. Can represent either the insured or the insurer. Adjuster - Emergency - 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. Adjuster - Independent - 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 - 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 - Salaried employee of one insurance company who can work locally, regionally, or nationally. Also called: Company Adjuster Advance Payment Settlement - 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 - 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 - Authority that is expressly given to the agent in writing. Allows agent to act on behalf of the principal. Agency Authority - implied - Authority that an agent possesses by implication of her behavior, regardless of whether this authority is granted in writing. Agency Authority - apparent - Authority that an agent possesses based on the appearance of representing the insurer. Agent - Someone who has received authority from an insurer to sell or service insurance policies. Aggregate Limit - 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). Agreement - 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 - A business that grows, harvests, and sells crops for profit. Aleatory - 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 - 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 - An item's Replacement cost divided by the number of years in its expected lifespan. Appraisal - 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 Coinsurance - The Coinsurance Clause applies to policyholders who purchase an inadequate amount of property insurance. These policyholders must pay a percentage of the claim. In health insurance, coinsurance refers to the portion of a covered claim that the insured is responsible for paying out-of-pocket, after the deductible has been paid. Code of Ethics - A set of governing professional standards of conduct, usually created by regulatory bodies or government regulatory agencies. These standards may also be formally codified with statutes. Coercion - The practice of forcing another party to behave in an involuntary manner (whether through action or inaction) by use of threats or intimidation or some other form of pressure or force. Commerce - The exchange or transport of goods or property. Commercial - Having to do with commerce or business activity in general. Commercial Crime Insurance - Commercial insurance that covers employee dishonesty and theft by employees or others. Commercial Lines - A variety of insurance coverages that protect those involved in the business of creating, selling, displaying, evaluating, or shipping, etc. Example include: Business Owner's Policy; Commercial Property; Commercial General Liability; Workers Compensation; Professional Liability (D&O), Errors and Omissions (E&O) and Employment-Related Practices Liability. Commercial Property Floater - A means of protecting a business' property that is not in one fixed location. Common Crop Insurance Policy - A single uniform policy that combines Crop Revenue Coverage, Revenue Assurance, Income Protection, and Indexed Income Protection. Common Law - Based on court decisions and customs when statutory law does not provide an answer; creates precedent. Compensatory Damages - Money awarded in civil court for tangible and intangible damages caused by a policyholder. Compensatory damages - Special - Money awarded for the exact value of the physical damage caused to the plaintiff up to the trial date. This is an objective value determined by receipts and medical bills. Compensatory damages - General - Money awarded for the emotional losses of the plaintiff that will continue after the trial date. These are a subjective value and are determined by the court. Competence - One of the four qualifications of a legally binding contract. All parties must be competent, with the necessary legal and mental capacity. Complaint - A complaint initiates a civil lawsuit by a claimant requesting financial relief from damages caused by a policyholder. Concealment - The act of withholding relevant material facts from an insurer. Conditions - The section of a policy that qualifies or limits an insurer's promise to pay or perform. Consideration - One of the four qualifications of a legally binding contract. All parties must bring something of value to the contract. Contract - An agreement entered into voluntarily by two parties or more with the intention of creating a legal obligation. Coverages - The amount and extent of protection provided by an insurance policy. Crime - An offense against the State or Federal Government, or a breach of law, for which the offender shall make satisfaction to the public. Criminal - Someone who has been convicted of a criminal act in a court of law. Crop Hail Insurance - A form of Crop Yield Insurance that is usually provided by private insurers without government subsidy. It offers named-peril protection on an acreage basis. Crop Insurance - Insurance coverage designed to protect a farmer's financial investment in his or her crops. Covers losses to a crop's profitability. Crop Revenue Insurance - Crop insurance that combines crop-yield insurance and price insurance to protect against losses to crop value. Crop Yield Insurance - Crop insurance that covers physical losses to actual crops. Damages - general - Intangible losses such as pain and suffering, or mental anguish. Damages - special - Tangible, financial losses that can be documented. Dangerous Instrumentality Doctrine - States that anyone involved in the use of inherently dangerous products or machines is held 100% liable for their own damages. Dec Page - Also called the Declarations Page. First page of a policy, which provides a summary of the contract; includes names of insured, addresses, coverage limits, policy period, etc. Declined Coverage - takes place when an insurance company rejects an application for coverage. Deductible - Deductible: the amount the policyholder must pay out-of-pocket before the insurance company will pay the remaining costs. Deductible - fixed - A fixed deductible is one specific, predetermined amount that a policyholder must pay out-of-pocket before he can be indemnified. Deductible - percentage - A deductible that is calculated as a percentage of the value of the insured risk. Deductible - franchise - A franchise deductible states that the policyholder only pays for damages that are less than his deductible. If the cost of damages equals or exceeds his deductible, the insurer pays the full amount and the policyholder pays nothing. Defamation - Damage to another's name or reputation, whether by libel, which is in print, or by slander, which is in speech. Default Judgement - Default Judgement is entered by the court against the party who failed to defend against a claim brought on by another party. In other words, if the person fails to show up and answer the claim the court will find in favor of the other party. Definitions - Page in policy that gives specific limited meaning to terms used in policy. Depreciation - A decline in value of property caused by wear or loss of usefulness usually measured by a specific formula. Direct Loss - Physical harm to tangible property caused by a peril. Discoverable - Capable of being demanded and handed over as evidence in a court of law; during litigation proceedings, the adjuster's claims file is discoverable. Eligiblity - Eligibility Requirements are found in some insurance policies. They identify the conditions that must be met by the policyholder in order to qualify for coverage under a policy. End of Insurance Date - The date that crop insurance coverage will end. It is the earliest of: total crop destruction, harvest of the crop, final adjustment of a loss, abandonment of a crop, or a date predesignated by crop type. Group Risk Income Protection (Crop Insurance) - A form of Crop Revenue Insurance that protects a whole county or area instead of individual farmers. Automatically indemnifies if county income falls below a certain level. Hazard, Moral - Hazard caused by insured persons deliberately engaging in risky behavior because they know that insurance will indemnify them for the losses. Hazard - Anything that increases the chance of loss. Hazard morale - Unconscious tendency of insured people to engage in riskier behavior. Hazard Physical - Any physical condition that increases the chance of a loss. HIPAA - Health Insurance Portability and Accountability Act, 1996 US law protecting consumer privacy, regulating collection, use and storage of private information. HO Forms 2 - The "broad" or "cheap" form of Homeowners Insurance; a basic, named- peril HO form that nevertheless is less limited than the HO-8. HO Forms 3 - "Special form" of Homeowners Insurance; all-peril coverage for structures, named-peril coverage for contents. HO Forms 4 - "Contents broad form"; named-peril renter's policy covering only personal property and any structural improvements made at tenant's own expense. HO Forms 5 - "Comprehensive form" of Homeowners Insurance; provides all-peril coverage to both structures and contents; the Cadillac of HO forms. HO Forms 6 - "Condo" or "unit owner's form"; named-peril homeowners policy covering personal property and the surface structure of a condominium. HO Forms 8 - "Modified coverage form" of Homeowners Insurance; named-peril coverage for structures and contents, fewer perils covered; form for buildings with low value. Homeowner's Policy - An insurance policy that combines property coverage with liability coverage for a person's home. IIPPA - The Insurance Information and Privacy Protection Act regulates how an insurance company can use consumers' private information. Impaired Property - Property that is defective because the insured's deficient or incomplete additions or work. Income Protection (Crop Insurance) - A form of Crop Revenue Insurance. One of the cheapest available; provides a fixed revenue guarantee based on early commodity prices for the crop type. Indemnification - Reimbursement for a loss, which leaves the claimant in the same financial position that she was in before the loss. Indemnify - To restore by payment, repair, or replacement Indemnity Insurance - Insurance that indemnity's loss as opposed to liability Indirect Loss - An economic loss that results from the direct, or physical, loss. Inland Marine - Insurance that protects property being transported over land Insurable acreage - All of the acreage of the insured crop, for which a premium rate is provided in the actuarial documents, in which the insured has a financial interest, and which is planted in the county listed on the application. Insurance - A financial device that transfers the risk of unexpected, catastrophic losses from one party to another. Insurance Company - Company which sells insurance policies to individuals or to other companies. Insurance Policy - A contract wherein an insured pays premiums to an insurer in exchange for financial protection in the event of a covered loss. Insurance Rating Systems - Methods of evaluating the risk involved in insuring a person, property, or a corporation. Insurers use rating systems to calculate premiums. Insured - A person or entity who is covered under an insurance policy. Insured crop - The crop in the county for which coverage is available as specified by the policy. Insurer - The person or entity providing coverage to one or more insureds. Insuring Agreement - A section of an insurance policy that summarizes the insurer's promise to pay. Includes list of covered property and perils. Interest - Direct financial interest in protecting a unit. Intervening Cause - A separate occurrence that "intervenes" between a defendant's actions and damage or loss to another person. An intervening cause may decrease the defendant's liability, if the defendant can show that it was the intervening cause (rather than the defendant himself) that caused the damage or loss. For example, say your neighbor asked you to watch his Yorkshire terrier during his weekend vacation. As the dog explores the ravine behind your house, a red tailed hawk swoops down and carries the little dog away. When your neighbor sues you for negligence, you could argue that the hawk (and not your own negligence) was the real cause of loss. Joint - Liability shared by two or more persons. Judgement - An official court ruling forming a final decision resolving a dispute or forming a final decree. Kickbacks - Any sort of reward or remuneration for referrals or favors; for example, a body shop giving money to an adjuster for referring customers. Landlord - One who has leased property to a tenant. Late planting period - 25 days after the final planting date, during which the yield and/or revenue guarantee drops by one percent per day. Leased worker - Worker hired through a labor leasing firm. Legal Purpose - One of the four qualifications of a legally binding contract. The purpose of the contract must be legal (e.g. no contracts for illicit drug deals) Liability - An obligation to do or not to do something; responsibility for an action. Liability Insurance - Liability insurance indemnifies a third party for damages caused by the insured's negligence. Liability - employer - Protects employers from damages and bodily injury caused to employees or by employees while performing under the scope of their employment. Liability - product - Protects a policyholder from legal liability for damages to third parties caused by the manufacturing, merchandising, distributing, or operation of a product. Liability - public - Protects individuals and commercial venues from any property damage or personal injury they may cause to the general public Liberalization - The liberalization clause in an insurance contract is a condition that states that the insurer can add or broaden coverage at any time without writing up a new contract. This clause guarantees that, in the case of legislative action that broadens insurance coverage without any increase in premiums, this additional coverage must take effect in existing policies as well as in new policies. License - A document that shows that a person has been granted authority by the state to act as an insurance agent, broker, or adjuster. Offer - The 'Offer' is a claim submitted to the insurance company for compensation due to a loss or losses the claimant believes are covered by the insurance policy and is legally considered an 'offer to settle' the claim. PAP - The Personal Auto Policy is a package policy that combines property damage and liability insurance for motor vehicles. Paul the Policyholder - In this course, Paul the policyholder represents any and all persons or entities who hold a policy. In other words, anyone who is insured. PD - Property Damage: damage or loss of use of personal property. Peril - The actual cause of loss or damage, such as lightning, fire, or theft. Personal - Personal Lines insurance protects the personal and real property of an individual. A Personal Auto Policy and a Homeowners Policy are examples of Personal Lines of insurance, as opposed to Commercial Lines. Personal Injury - Damages to a third party's character, reputation, or standing in the community. Personal Property Floater - Protects property owners from damage or losses to personal articles while in the process of transport. PIP - Personal Injury Protection: a form of no-fault auto insurance utilized in some states. Policy - See Insurance Policy. Policy Period - The beginning and end dates of coverage. Found on declarations page. Policyholder - Also called the "insured", a policyholder is a person who has purchased an insurance policy - or contract-from an insurer. Power to bind - One manifestation of the authority given to insurance agents by the principal. The principal is bound by, or must adhere to, the guarantees and statements made by its agent. Premium - A scheduled and affordable fee, paid by the policyholder to the insurer, in return for coverage. Preponderance of Evidence - A preponderance of evidence is enough evidence to make it more likely that an argument is true than that it is false. In a civil trial, the plaintiff needs to provide a preponderance of evidence in order to win her case. Principal - The principal refers to an agent's employer (usually an insurance company, but it could also mean anyone who contracts the agent to work on their behalf and gives her the authority to do so). Principle of Indemnity - The principle behind all insurance contracts. It states that, when a loss occurs, the insured should be restored to his or her financial condition before the loss occurred, no better, no worse. The insured cannot profit from a loss. Privacy - In insurance, the right of consumers to have their personal information protected. Private - Private insurance is the term for any insurance other than social insurance. Social insurance programs are run by the government instead of by private individuals. Private Crop Insurance - Crop insurance that does not fall under the Federal Crop Insurance Program and is provided directly to farmers by private insurers. Professional Liability - Professional Liability Coverage is insurance that protects practitioners such as doctors, lawyers, engineers, architects, etc.. It includes two types of coverage: malpractice insurance and errors and omissions insurance. Proof of Loss - The form or statement that the policyholder is required to submit to the insurer before she can be indemnified for a loss. Proximate Cause - The original occurrence, the source, of all the subsequent damages. Punitive Damages - Intangible damages awarded to the plaintiff when the defendant's actions show intentional heinous, antisocial behavior or extreme indifference to harm. They are determined by the court. Rating Systems - Measure hazards of individual risk in a given area, and sets premiums accordingly. RC - RC: Replacement Cost, It refers to the cost of repairing or replacing an insured item, based on the item's value at the time of the loss. Rebates - Refunding of part of the premium, due to the creation of a new contract or change to an existing contract. Reciprocal Insurers - A Reciprocal Insurer is an unincorporated organization of subscribers that operates through an attorney-in-fact to provide insurance benefits for its members. Reinsurers - Companies which sell insurance to insurers to reduce the insurer's exposure to loss. Reporting - One of the adjuster's duties is to Report to the Principal. The adjuster must give the principal frequent updates of her progress on any given claim. Replacement Cost (RC) - The cost of repairing or replacing an insured item, based on the item's value at the time of the loss. Reservation of Rights - A notification that an insurer might give to an insured, informing him that a reported loss might not be covered under his insurance policy. Retroactive date - Date preceding a policy period before which the policy will not cover occurrences. Revenue Assurance (Crop Insurance) - A form of Crop Revenue Insurance that provides a fixed revenue guarantee based on average county prices Revenue Protection (Crop Insurance) - Also called Yield Protection, this is the most comprehensive form of Crop Revenue Insurance, offering higher coverage amounts than other types. The revenue guarantee is based on the higher of: harvest-market price or early market price. Previously called Crop Revenue Coverage (CRC) Risk - In the insurance industry, risk can have two meanings: 1) the potential for financial loss; being exposed or open to damage, 2) an insured item. Risk Avoidance - Insurers' practice of denying insurance applications that they believe would involve an inordinate amount of risk. Risk Management - Measures taken by an insurance company to ensure that their exposure is not too high and to control the effect of a loss; for example, an insurer might charge higher premiums to drivers who have received speeding tickets. Risk Management Agency - A federal agency under the USDA that administers the Federal Crop Insurance Program. Risk Purchasing Groups - Groups of people with similar insurance needs who form an organization to buy insurance as a group. Risk, Pure - Risk that does not entail the possibility of gain; the only possible outcomes are a loss or no loss. Risk Reduction - An insurer practices risk reduction when it takes precautions in order to reduce its exposure; for example, requiring that all homes insured by a homeowners policy have fire alarms installed. Risk Retention - An insurer practices risk retention when it chooses to insure a risk instead of denying coverage. deliberately causes. Again, certain perils are too catastrophic to be insurable (like war or nuclear events). Unscheduled - Unscheduled property is property covered under an insurance contract that is not listed item by item (as "Scheduled" property would be listed). U.S. Environmental Protection Agency - Federal agency primarily responsible for the implementation of most federal laws designed to protect, enhance, and conserve the nation's natural resources. Utmost Good Faith - A characteristic of insurance contracts: 'utmost' meaning the 'highest degree' and 'good faith' meaning, "act with honesty, fair dealing and full disclosure." All parties to an insurance contract must act with utmost good faith. It also applies to a fiduciary agent's responsibility towards the principal. Valuation - The processes of estimating what an item is worth. Value - The estimated or appraised worth of an item, used to determine the replacement cost or indemnification amount. Valued policy - A policy in which the insurer and the insured agree to a specific value prior to the start of the policy. If the item is lost or destroyed, the insurer pays the amount agreed upon. Vicarious Liability - When an act of negligence is transferred from one party to another, such as from employee to employer or from child to parent. Waiver - A waiver is a voluntary act of relinquishing a known right, claim or privilege. Either an insured or an insurer may waive rights. Waiver - Express - An explicit relinquishment of a right. Waiver - Implied - An implicit relinquishment of a right through behavior that seems to assume that the right does not exist. Waiver of Sovereign Immunity - Sovereign Immunity disallows an individual to sue a governmental entity; the waiver of sovereign immunity allows individuals to sue governmental entities under specific circumstances. Warranty - An ongoing assurance made by the insured that certain conditions in an insurance contract will be met (for example, that the insured will maintain functional fire alarms). Workers Compensation - form of insurance that covers medical costs and lost wages in the event of injury, disease, or disability sustained by an employee in the course of his work/ Purchased by employers. Wrongful Death Act - allows the individuals who are associated with a deceased person who was killed because of a negligent act to sue the responsible party. Yield Protection (Crop Insurance) - See Revenue Protection (Crop Insurance)