GA Adjuster Exam Review

The NAIC Model Unfair Claim Settlement Practice Act provides for a financial penalty of

$1,000

What is the maximum penalty per violation if a person willfully and knowingly or intentionally makes any false or misstatement for the purpose of obtaining or denying benefits or payment of workers compensation coverage?

$10,000

In Georgia, the Chief Deputy Commissioner must execute a bond in the amount of:

$15,000

The supplementary payments of Section II - Liability of the Business Automobile policy covers the cost of a bail bond up to:

$2,000

The Commissioner in Georgia may, after a hearing, fine an insurance company which of the following if violations of the insurance code are discovered?

$2,000 for each act of misconduct and up to $5,000 for each act of willful misconduct.

What is the application fee for filing to become a self-insurer for workers compensation in Georgia?

$500

The standardized Dwelling forms allow the insured to bring legal action against the insurer if they have complied with all policy provisions and the action is brought within:

2 years after the date of loss

Upon the examination of any person, employee or officer, the Georgia Insurance Commissioner will provide a copy of the report to those examined at least _____ days before filing the report for public access.

20 days

If an injured employee hires an attorney to represent them in a workers compensation claim dispute, what percentage of the income benefits can the attorney charge for the representation?

25%

All resident and nonresident licensees must promptly notify the Commissioner in writing within _____ of any change in the business address.

30 Days

The Commissioner can hold hearings for any purpose he or she deems necessary but must give notice of the time and place of the hearing, must provide that the hearing be open to the public, and provide a notice of at least:

30 days

How long can temporary total disability payments be made to an injured employee?

400 weeks

A commercial lines policy has been in effect for more than 60 days.The insurer intends to cancel for an approved reason other than non-payment of premium. How many days advance cancellation notice must be sent to the first named insured?

45 days

Adjusters must maintain record of each investigation or adjustment undertaken, and a statement of any fee, commission, or other compensation received or to be received on account of the investigation or adjustment. How long must the records be maintained for examination?

5

A typical directors and officers liability policy covers each of the following, EXCEPT:

A D&O policy protects corporate officers and directors. Typically, no coverage is provided for the entity itself, apart from its obligation to reimburse the officers and directors for expenses and damages paid in legal proceedings that are allowed by its bylaws.

A surety bond is:

A form of credit

What is a "notice to show cause?"

A notice that states the proposed action may be taken by the Insurance Department unless the person shows cause at a hearing why the action should not be taken.

Coverage for workers compensation coverage in Georgia is optional for which of the following?

A partner or sole proprietor A partner or sole proprietor is not an employee of the business unless he/she wishes to be included as an employee in the coverage provisions and so advises his or her insurance company.

All of the following would be covered under a Builders Risk Policy, EXCEPT:

A prospective buyer

A manufacturing company is sending two U.S. employees to Russia to discuss their products and visit a similar Russian manufacturing plant. What coverage would be needed for injuries they may incur in a work-related accident while abroad?

Add the Foreign Coverage Endorsement to the company's workers' compensation policy.

Which of the following relieves the financial burden on the claimant by making certain payments to the claimant even before the claim is negotiated?

Advance Payment

A dual capacity claim in Worker's Comp is filed

Against an employer that was acting in any capacity "Other Than an Employer" at the time the injury occurred.

Which of the following would be considered an "incidental occupancy" under a Homeowners policy?

An art studio located in the named insured's home, where she also holds occasional painting classes.

The person who agrees to indemnify the surety if the principal defaults is known as an

An indemnitor.

Mediation is not _____ on the parties involved, but with arbitration the decision is final and _____.

Binding

The limit of a bond is known as its:

Bond penalty

The wording of the Standard Fire policy is so vague that many insurers have to rely on __________ to take a position on the acceptance or denial of a claim.

Case Law

Which of the following is a general summary of a policy?

Certificate of Insurance

Churning

Churning occurs when an insurance agent replaces a policyholder's insurance policy for another insurance policy, usually without consulting the policyholder and often with no changes to the coverage itself. Agents who engage in churning do so in order to secure an additional commission for the new policy they swap in.

No insurer or licensee doing business in Georgia may pay any commissions or valuable consideration to any person for services as an agent, subagent, or adjuster unless that person is duly licensed under the

Code

Which of the following coverages does NOT need to be added to a Garage Coverage form by endorsement for coverage to apply?

Collision

What is the purpose of the Georgia Insurance Guaranty Association?

Cover claims of insolvent insurers

Which of the following is NOT covered by the Federal Employee's Compensation Act (FECA)?

Damages awarded by a court

Which of the following would be an example of a moral hazard?

Embezzlement - Embezzlement would be a deliberate act and therefore, be considered a moral hazard.

Which of the following is NOT a claim settlement option for liability claims?

Excessive amounts claimed are always contested by the insurer. Liability losses are categorized as "special damages"or "general damages." Special damages include medical expenses and loss of wages or the costs of other known expenses. General damages would include pain and suffering, punitive damages, loss of consortium, disfigurement and disability claims.

An insured has purchased BAP physical damage coverage against specified causes of loss. Protection applies to all of the following perils, EXCEPT:

Falling objects

The perils most frequently covered by a Difference in Conditions policy are:

Flood and Earthquake

In Georgia, a premium reduction for a defensive driving course applies in which of the following circumstances?

For each personal or family-type policy of private passenger motor vehicle insurance issued or issued for delivery in this state, the insurer must offer premium reductions of not less than 10% for motor vehicle liability, first party medical, and collision coverages if all named drivers of each motor vehicle covered by the policy satisfy the following requirements: 1. Have committed no traffic offenses for the prior three years. 2. Have no claims based on fault against an insurer for the prior three years. 3. Complete a defensive driving course which is one of the types of courses approved by the Code.

Monique's house is covered in brick veneer. Monique's house is which of the following types of construction that insurers use to set insurance premiums?

Frame Brick or any other type of veneer is placed over "frame" construction, which can be very susceptible to fire and wind.

The optional coverage for "Money and Securities" under a standard Businessowners policy provides for the loss of money and securities used in the insured's business as a result of all of the following, EXCEPT:

Fraud

Which of the following is not considered to be a residual market in Georgia?

Georgia Insurance Guaranty Fund.

The "period of restoration" for the Extra Expense coverage included on the Business Income form is:

Immediately following the direct physical damage

Agent Rice informs the insured that he needs to secure motor vehicle records on all of the drivers in the household based on company requirements. This is an example of Agent Rice's:

Implied authority - the authority the agent believes he has in order to do his job properly

Standard and Poor's, A.M. Best and Moody's are examples of:

Independent Rating Services

The perils insured against by a Homeowners policy are contained within the:

Insuring Agreements

All of the following statements are true regarding an interline endorsement used in a Commercial Package policy (CPP), EXCEPT:

Interline endorsements are used in the CPP to simplify coverages and conditions among many different forms and apply only to two or more coverage parts.

Interline Endorsement

Interline endorsements are written to change more than one coverage part that is included in a Commercial Package policy.

The Watercraft Endorsement to the Homeowners policy provides:

Liability and Medical Payments coverage that would otherwise be excluded under the Homeowners policy.

The limits of the Employers' Liability section of a standard workers' compensation policy are:

Listed on the information page

________ is a legal term describing an intentional act that is illegal or morally wrong, that contributes to the injury of another person.

Malfeasance

Which of the following is NOT a coverage of the Truckers form?

Medical Payments

Advertising injury coverage applies only if the offense arises from:

Misappropriation of ideas or copyright infringement in the course of any advertising

How soon, following a hearing, must the Commissioner enter an "order" revealing his or her findings?

No later than 30 days

Coverage D - Loss of Use on the Homeowners forms provides coverage for "Civil Authority Prohibits Use" for:

No more than two weeks.

Georgia has a valued policy law that applies to insurance on a one or two family dwelling. If a total loss occurs to the dwelling after the policy has been in effect for 30 or more days, the insurance company must:

Pay the full amount of insurance on the dwelling.

Which of the following coverages would NOT be included in the liability section of the Businessowners policy?

Professional liability

Making false or misleading statements about dividends or shares of surplus previously paid on an insurance policy is known as:

Rebating

The Motor Carrier Act of 1980:

Requires trucking operators to file proof of liability insurance..

Regulation of the insurance industry in the United States is primarily left to:

State governments

Twisting

The act of inducing or attempting to induce a policy owner to drop an existing life insurance policy and to take another policy that is substantially the same kind by using misrepresentations or incomplete comparisons of the advantages and disadvantages of the two policies. Most states have enacted legislation making twisting a crime.

The manual premium under a workers' compensation policy are based on:

The classification of work the employees perform.

Which of the following statements is TRUE regarding the Homeowners "additional coverage" known as Landlord's Furnishings?

The coverage is not additional insurance and does not increase the limits of the policy.

The most significant change that occurs when a Mobile Home endorsement is added to a Homeowners policy is that:

The description of covered property is changed.

An insured carries a liability policy and an umbrella policy. The verdict in a personal injury liability suit was higher than the insured's underlying liability policy's limit of insurance. In this situation:

The insurance company providing the insured's umbrella liability policy can appeal the case at its own expense even if the insured and the company providing the underlying policy do not appeal.

Underinsured motorist coverage provides first-party protection to an insured after an accident in which of the following situations?

The other driver has insufficient liability limits and is "at-fault". .

Insurance adjusters have the "power to bind". Which of the following statements best describes what this means?

The principal is bound to the decisions of the adjuster.

Errors and omissions claims may be brought against insurance agents/producers by:

Their clients/insureds and the insurance companies with whom the agent/producer contracts.

Which of the following is NOT TRUE regarding surety bonds?

They are an agreement that in exchange for a premium, the surety will indemnify the obligee.

Binders can be made either in writing or made orally for a period of 90 days.

They can be extended for another 90 days with the written approval of the Insurance Commissioner.

Which of the following best describes the reason for using various work classifications in the calculation of workers' compensation premiums?

To accurately reflect the risks of each employer.

Which of the following best describes the purpose of the "insuring agreement" contained in an insurance policy?

To the insurer's promise to pay in case of a loss..

If an insured intentionally conceals a material fact on an application for insurance, the coverage may be:

Voided

If the Agreed Value option of the Business Income form is selected by the insured, the coinsurance requirement is:

Waived

A loss reserving method that establishes aggregate reserves for all claims for a single line of insurance is known as:

Loss ratio method

Which of the following classifications of disability would be most likely be provided vocational rehabilitation under workers' compensation?

PPD.

Rebating

Rebating — a portion of the premium or the agent's/broker's commission on the premium to the insured or other inducements to place business with a specific insurer. Rebating is illegal in the majority of states. Insurers must use filed rate credits or have supporting methodology.

The Georgia Insurance Commissioner has the power to issue temporary licenses under certain circumstances. How long may a temporary license remain active?

Six months and can be renewed for up to 15 months. .

Which of the following property insurance cause of loss forms provides coverage for all risks of loss?

Special

Any rules or regulations established by the Georgia Insurance Commissioner must be approved by:

State Attorney General

Which of the following Business Automobile policy symbols permits the insured to purchase coverage for both liability and physical damage?

Symbol 3 is the only BAP symbol that covers the automobile for both liability and physical damage coverage. Symbols 6,7, and 19 (among others) provides only liability coverage.

Which of the following statements is NOT TRUE of the Builders' Risk coverage form?

T

In GA, _____insurance cannot be written by a reciprocal type insurer.

life

To be eligible for coverage under a standardized Dwelling policy, the insured must not allow more than _______ boarders to live on the premises.

5

Georgia licensees may carry forward continuing education credit not to exceed ___ of the annual continuing education requirement.

50%