Texas all lines adjuster exam

The insured carries an unendorsed DP-3 dwelling policy on his home and personal contents. While traveling abroad someone broke into the home and stole $200 in cash, a shotgun valued at $1,000, and other household items valued at $2,000. Damage caused by the burglars is $1,500. Assuming no deductible applies to their coverage how much would be paid?

$1,500

What is the minimum limit for Coverage L of the Personal Liability Supplement that can be attached to a Dwelling Property policy?

$100,000

Parmelia is covered under two separate standardized Personal Automobile policies, with Part C limits under both policies set at $200,000. Parmelia is involved in an accident with an uninsured motorist and she sustains bodily injury damages for $262,320. How much will Parmelia receive when she submits a claim for these damages

$200,000

Hannah must take time away from work to help assist in the investigation of a claim that was made against her BOP policy. The policy will pay for Hannah's actual loss of earnings up to:

$250 per day.

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 or set clause the insurance company will pay a maximum of which of the following amounts?

$7,000

Surplus Lines companies in Texas have _____ to acknowledge the receipt of a claim.

30 days.

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

5

The standardized Dwelling forms consider all eruptions of a volcano within a __________ period to be a single "occurrence".

72-hour

When insurance is written on a Dwelling form, each of the following types of property would be insured under Coverage A, EXCEPT:

A detached garage.

Which of the following is TRUE regarding the DP-2 Broad Form coverage for "artificially generated electrical current"?

A fire must be the result of the artificially generated electrical current for coverage to apply..

All of the following would be considered "uninsured motorists", EXCEPT:

A motorist driving with coverage up to the required state financial responsibility limits for liability, but not high enough to pay the claims for an at-fault accident.

Acme Corp. requested three bids from different contractors for the construction of its new office building. Acme accepted the lowest bid from Corbett's Contracting and entered into a contract to have the office building constructed. After construction was completed, Corbett's presented Acme with a bill for construction costs over and above the amount of the bid that was agreed to in the contract. Which of the following types of bonds would protect Acme from paying the additional costs?

A performance bond.

Which of the following are NOT required to hold an adjuster license in Texas?

A person who works for an insurer and adjusts claims on losses that do not exceed $500

The "Medical Payments" section of the standard Yacht policy will provide coverage for all of the following, EXCEPT:

A scuba diving accident when diving from the insured boat..

Ellen's automobile is stolen. The theft is properly reported to the police and the insurance company. She rents a car for two months. Which of the following would apply for the rental car?

After a waiting period of 48 hours, her policy will pay $20 per day up to a maximum of $600

Loss to insured property caused by self-propelled missiles is covered under which of the following perils of the Homeowners form?

Aircraft.

All of the following statements are TRUE if Builders' Risk coverage is written on a completed value basis, EXCEPT

All premiums must be paid up front before construction can begin..

The Commercial Building and Personal Property coverage form provides five extensions of coverage, but only if:

An 80% or higher coinsurance percentage is shown on the Declarations page, and the property amount of coverage, based on that percentage, is purchased.

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.

Economic loss that is the consequence of a direct loss is known as:

An indirect loss.

Under Section II of a Homeowners policy, a cemetery plot owned by the insured is considered to be:

An insured location.

An insured submits a claim to the insurer and their adjuster acknowledges receipt of the claim. The insured then hears nothing more after making repeated attempts to contact the adjuster. This is considered:

An unfair claims settlement practice.

The crew of a ship is guilty of fraud with the intention of reaping gains at the expense of the owner. In ocean marine coverage, what is this called?

Barratry.

Catherine suffered a covered cause of loss that resulted in water in her basement along with other damage. Alan, an adjuster for Binders Keepers Insurance, tells Catherine to immediately have the water damaged carpeting and wall paneling removed from her basement, so that mold will not cause further damage. Alan then begins the process of identifying coverage under the policy and finds that the water damage is not covered. Which of the following statements is TRUE regarding this claim?

Because Alan told Catherine to remove the carpeting and paneling before he checked the coverage, he waived the right of Binders Keepers to deny the claim..

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

Collision.

All of the following statements regarding the Commercial Package Policy are correct, EXCEPT:

Commercial Package Policies can include Ocean Marine and Aviation Insurance coverage. .

Which of the following statements is TRUE regarding Commercial Property coverage?

Commercial property coverage can be written as both a monoline policy and as part of a package policy.

All of the following are characteristics of a principal that a surety will scrutinize during the underwriting process, EXCEPT:

Consideration.

The amount of insurance countersigned, issued, or sold by an agent or producer to cover immediate family members, an employer, or employees is known as:

Controlled business

Which of the following is NOT TRUE of coverage for Business Personal Property and Personal Property of Others in a Commercial Property policy?

Coverage is provided while the property is located within a covered vehicle at any location as long as the vehicle is owned by the insured business.

Which of the following statements is TRUE regarding the coverage extension of the standard Businessowners policy for "Business Personal Property Temporarily in Portable Storage Units"?

Coverage will not apply if the storage unit has been on the insured premises for longer than 90 days, even if the business personal property has only been stored there for less than 90 days.

Which of the following would be covered under the Jones Act?

Crew members of a ship.

Which of the following would be considered an Unfair Claim Settlement Practice?

Failing to deny coverage of a claim within a reasonable amount of time after concluding the investigation

Which of the following basic coverages are provided under a Standard Fire policy?

Fire, lightning and removal..

An agent, insured or claimant has intentionally deceived an insurer for financial gain. Such an act is known as:

Fraud

All of the following is a function of the standard mortgage clause in a property insurance policy, EXCEPT:

Guarantees that the mortgage payments will be made by an insurance policy, if the insured does not make the payments. .

All of the following are perils NOT typically covered by property cause of loss forms, EXCEPT:

Hail

A ship has suffered damage and sunk. Which of the following would respond to cover the loss of the ship?

Hull Insurance.

A non-waiver agreement allows the insurer to:

Investigate a loss without implying that it is covered

The Garage Coverage form can be used to cover dealers that sell all of the following, EXCEPT:

Jet skis.

Which of the following are the Texas Workers' Compensation benefits that are increased by a cost-of-living adjustment (COLAs)

Lifetime Income Benefits (LIBs) only

Which of the following is NOT an "alternative dispute resolution" (ADR) used to deal with coverage disputes in the claim settlement process?

Litigation

The 1943 New York Standard Fire policy specifically excludes all of the following, EXCEPT:

Manuscripts.

Max was injured on the job in Texas. Max has reached MMI but will have a permanent limp while walking that was due to the compensable injury. Which of the following terms as defined by the Texas Workers Compensation code best describes how Max's injury will be classified?

Max's injury is now classified as an "impairment".

Scott lives in Texas and has submitted a claim to his insurance company. He has received notice from the insurer that the claim is covered under the policy and they will be paying the claim. How long does the insurer have to pay Scott's claim according to Texas law?

Not later than the fifth business day after the notice was made.

The importance of an "Insured or Witness Investigation" is that:

Obtaining their statements is very important in determining who is liable

If the disability for a worker in Texas continues for more than one week, weekly income benefits begin to accrue:

On the 8th day after the disability began

As a fiduciary agent, an adjuster has the power to bind the insurer. Which of the following statements is FALSE regarding this power?

Only an adjuster's written statements can legally bind an insurer.

Which of the following is NOT eligible for a coverage under a Homeowners insurance policy?

Owner-occupants of a 5 to 6-family dwelling

The part of a standard workers' compensation policy that contains the cancellation procedures is:

Part Six - Conditions

Which of the following is NOT covered under aircraft physical damage (hull) insurance?

Personal effects.

Which of the following coverage parts would be eligible for inclusion in a Commercial Package policy?

Professional liability coverage.

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

Professional liability.

What type of insurance is usually provided or subsidized by the state or federal government because it is not ordinarily available from private insurers?

Residual market insurance.

Which of the following is NOT one of the four major coverages of an Ocean Marine policy?

Seaworthiness.

The HO-3 form insures for direct physical loss to covered property involving collapse of a building caused by all of the following, EXCEPT:

Settling.

George went out for target practice one day with his handgun. He has practiced many times with the same target located in the woods behind his house. Unbeknownst to George, a neighbor was walking in the woods behind the target one day and was shot in the leg by George. Intentional acts are never covered by insurance, however, the claim filed by the injured neighbor may be covered under George's liability coverage. Which of the following is the most likely reason why?

Shooting the gun was an intentional act committed by George, but the consequences of act (his neighbor being shot) were not intended.

Which of the following best describes an "insurance producer"?

Someone who represents an insurance company in the soliciting and negotiation of insurance.

After completing an inspection of an insured's pressure equipment and fire suppression systems, the inspector determines that the pressure equipment needs to be repaired and the suppression systems have not been cleaned and inspected in the time frame required by the policy. The insurer will:

Suspend coverage immediately by red tagging the items until they are repaired, cleaned and pass reinspection

Symbol 23 is designated on the insured's Garage Coverage form. This indicates that:

That owned private passenger autos only are covered..

The optional coverage for "Employee Dishonesty" under a standard Businessowners policy provides a "discovery period" for the insured to discover the dishonest act and have coverage still apply. Which of the following statements best describes the "discovery period" for this optional coverage?

The "discovery period" is one year from the end of the policy period.

Which of the following standardized Dwelling insurance forms provides coverage for loss of rental income

The DP-1, DP-2, and DP-3 forms

Ocean marine coverage for losses to the insured vessel caused by bursting boilers, latent defects in the vessel and negligence of the master or crew members are addressed by which of the following?

The Inchmaree clause.

The insured carries a Personal Auto policy and a Personal Umbrella policy. In case of a loss, how would the policies respond to pay a covered claim?

The Personal Auto policy would be the primary and would pay up to the policy limits, then the Umbrella policy would be excess to pay up to its policy limits.

Which of the following sections of an Ocean Marine policy is very similar to the "Duties of the Insured" in other property policies?

The Sue and Labor clause

Whose responsibility is it to complete a "proof of loss"?

The claimant.

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.

Coverage under a standard Personal Watercraft policy extends to all of the following, EXCEPT:

The crew of the boat for medical payments

An insured is covered under a CGL policy. He would like to purchase another policy to increase the limits of insurance for his commercial liability exposures. Which of the following statements is correct regarding the insured's situation?

The insured may purchase either a Commercial Umbrella or an Excess Liability policy to increase his liability insurance limits..

All of the following statements are true regarding a Personal Liability Supplement, EXCEPT:

The policy will cover watercraft liability.

Which of the following is NOT a "duty of the insured" after a loss?

To pay damages to any third-party claimant while waiting to be reimbursed by the insurer for the loss.

An insured's boat is struck by another boat. He and his family are injured. His boat sinks because of the damage. An investigation determines that the party that caused the accident is not insured. If the insured carries a watercraft policy, what coverages would apply?

Uninsured boater's coverage and hull insurance.

Which of the following endorsements must be attached to a standard Businessowners policy for coverage to apply to a businesses freezer that was damaged by the interruption of a power source

Utility Services - Direct Damage endorsement.

All of the following are correct statements regarding the limits of liability under Part A of a Personal Auto policy, EXCEPT:

When the Part A limits are exhausted, any limits for Uninsured Motorists coverage can be used to pay the entire claim..

All of the following are criteria for an accident to have occurred "in the course of" the employment under a workers' compensation policy, EXCEPT:

While performing a task that a fellow worker requested, that was unusual to the employee's job description, but occurred on the employer's premises during working hours.

When an insurer files a declaratory judgement action with a court of law, all of the following questions will be resolved by the court, EXCEPT:

Will the insurer become insolvent if they pay the claim as submitted by the insured?

The "Part B - Medical Payments" coverage of a personal automobile policy covers injuries for all of the following, EXCEPT:

A passenger who is injured in another vehicle that is struck by the insured's vehicle in an accident

If a covered business is a limited liability company, the standard Businessowners policy provides coverage for all of the following "insureds", EXCEPT:

Executive director..

The insured is covered under a Watercraft policy and asks the agent about a lay-up period credit to get a reduction in the premium. The dates of the lay-up period are specified in the policy. There is an emergency and the insured must use his boat in a life saving event. The boat is damaged and sinks. Under what circumstances would coverage apply?

Only if the insurance company is notified within 10 days of the emergency use

Which of the following types of bonds guarantees that all project materials will be paid in full by the contractor upon completion of the project?

Payment bond.

Workers' compensation insurance premium rates are typically affected by each of the following factors, EXCEPT:

The company's current profit or loss.

The additional coverage for debris removal under the standardized Building and Personal Property coverage form will only be paid if:

The insured reports the debris removal expenses to the insurance company in writing within 180 days of the loss..

An applicant fails to disclose known facts when completing an application for insurance. This act is known as:

Concealment

Mike purchased a policy several years ago to cover him for liability. Last year, Mike determined that the limits of his liability policy were not high enough to cover him adequately should a loss occur, so he purchases an excess liability policy to provide more coverage. Mike experiences a loss, and discovers that his underlying liability policy had expired before the loss, but his excess liability policy is still in effect. How will this loss be paid?

It will be denied, due to nonconcurrency.

The standard Personal Automobile policy provisions state that the insurance company has subrogation rights against any person permitted to use a covered auto, under all coverages, EXCEPT:

Part D.

As a condition to gain entrance into Louisiana to conduct insurance business, a Texas domestic insurer makes a deposit with the Texas Comptroller. The amount of the deposit is sufficient to satisfy the Louisiana Department that the insurer can cover the claims submitted by the insureds in Louisiana. Who has jurisdiction to collect taxes on the interest earned on this deposit?

The county and municipality in Texas where the principal business office of the insurer making the deposit is fixed by the insurer's charter.

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.

Chaz takes his girlfriend to an expensive restaurant for Valentine's Day. It is raining, so he decides to have the valet park his car, saving his girlfriend from getting wet. The valet is driving the car into the restaurant's parking garage, when he clips the side of the garage entrance with the front fender of Chaz's car. The garage wall needs to be repaired as well as the fender and headlight of Chaz's car. How would Part D of Chaz's Personal Automobile respond to this loss?

It would cover the loss to Chaz's car because it is the insured automobile, but would not cover the damage to the garage..

Which of the following statements defines a "bailee"?

Someone, other than the insured, to whom the insured property is entrusted temporarily.

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

State governments.

Which of the following losses would be covered under a Commercial Property policy with the special cause of loss form attached?

A fire that breaks out in an office building and causes damage to two of the offices..

All of the following are "Perils of the Sea" under an Ocean Marine policy, EXCEPT:

Pirates

Which of the following would be considered a Part D - Other Than Collision claim under a Personal Automobile claim?

A load of bricks falling from an apartment building onto the car.

Cameron has his home covered under a Homeowners policy and his limit for bodily injury is $100,000. He also purchased a Personal Umbrella policy with a $1,000,000 limit of liability. Cameron is sued and a judgement was made against him for $500,000. To trigger his Umbrella policy, his Homeowners policy must pay $100,000, but he finds that the insurance company from which he purchased his Homeowners policy has become insolvent. How will the Umbrella insurer pay the claim (disregarding any retention limit)?

The Umbrella policy will not become primary when the insurer carrying the underlying insurance becomes insolvent, but will pay the $400,000 as if the underlying insurer had paid its $100,000 limit of liability..

The Section I Additional Coverage of the standard Businessowners policy provides coverage for "Debris Removal". Which of the following statements best describes the limit for this coverage?

The total limit may be up to 25% of the policy limit for the loss payable with the deductible included, plus up to an additional $25,000 if the policy limits are exhausted

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..

Which of the following would NOT be determined by a court when an insurer has filed a declaratory judgment action?

The type and amount of damages that will be paid to a plaintiff for the claim that is being disputed.

Which of the following statements is NOT TRUE regarding the implied warranties of an Ocean Marine policy?

The implied warranties are attached to the policy as an endorsement..

The insured has liability coverage with a limit of $300,000 per occurrence. She purchases a $1 million Personal Umbrella to extend and broaden her coverage. The Umbrella policy includes a $10,000 retained limit. The insured becomes liable for $800,000 in damages that are excluded by the underlying liability policy, but is covered by the Umbrella policy. How would this case likely be settled?

The insured would pay $10,000 and the Umbrella policy would pay $790,000.

If the Navigational Limits or Lay-Up period shown on the Declarations page of a standardized Yacht policy is breached because of something out of the control of the insured:

The insurer must be notified within 10 days after the breach and any additional premium that is due must be paid.