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Adjuster Pro - Insurance adjuster test Exam Questions and Answers (A+ Guide)

What is insurance? - protection against financial loss

what is a premium - a scheduled amount to be paid for an insurance policy.

What are premiums used for - premiums are collected into a "pool" or "reserve to pay out claimants when needed.

how can insurance companies afford to pay for an individuals catastrophic loss? - the insurer collects premiums from all policy holders and uses them to pay out the claims of a few.

what is Indemnity - payment for damages, that is not more or less than the amount caused by the damage.

principle of idemnity - insurance will pay no more or less than the actual financial loss suffered

indemnification may also include - repairs to property reimbursement for additional living expenses rental cars and hotels costs directly associated with a loss

• Parts of Legal Contract - 1. Agreement
• Consideration
• Competent Parties
• Legal Purpose

legal contract - agreement - mutual intent by offeror and offeree

six special characteristics of insurance contracts - 1. Personal

• adhesion
• utmost good faith Stuvia.com - The Marketplace to Buy and Sell your Study Material

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Stuvia.com - The Marketplace to Buy and Sell your Study Material4. aleatory

• unilateral
• conditional

what kind of contract is an insurance policy? - Personal contract

what is a contract of adhesion - the insured must accept the entire contract with all of its terms and conditions

Utmost Good Faith - An obligation to act in complete honesty and to disclose all relevant facts.

Aleatory Contract - a contract where the values exchanged may not be equal but depend on an uncertain event

Unilateral Contract - insurance agrees that they must pay in event of a claim. the insured can stop paying premiums at any point.only the insurer has promised to perform an action.

Conditional Contract - A type of an agreement in which both parties must perform certain duties and follow rules of conduct to make the contract enforceable.

Acronym for the four sections of an Insurance policy - DICE D - declarations page I - Insuring Agreement C- Conditions E - Exclusions

Decelerations section - Always the first section - establishes the following Names of both parties Policy number Location and description of insured item Dates of the policy Amount and limit of coverage Deductible Premium Stuvia.com - The Marketplace to Buy and Sell your Study Material

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Stuvia.com - The Marketplace to Buy and Sell your Study Material Definitions section - Defines terms used to write policy including "collusion" "decay" "like kind and quality" Includes important language for adjusters to know

Insuring agreement section - What is covered and how Which causes of loss are covered Any services provided Any exclusions to coverage The maximum limit of policy coverage in dollars

Conditions section - Insurer specifies any limits or qualifications the policy holder must meet

Exclusions section - losses for which the insured is not covered for

Endorsements - Provision that modifies the coverage of the original contract Add or subtract coverage Synonyms - rider, addendum, attachment

Certificate of Insurance - A legal document that indicates that an insurance policy has been issued, and that states both the amounts and types of insurance provided.

Characteristics of social insurance - Non profit Mandatory participation Benefits prescribed by law Designed to meet needs of public Government has monopoly

Private Insurers - Sell insurance based on needs and preferences Wide variety of products Exist to generate a profit Insured party voluntarily participate

Stock Insurance Companies - Always for profit Publicly traded Stuvia.com - The Marketplace to Buy and Sell your Study Material

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