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Questions and Answers
Which regulatory body handles violations of each related insurance issue only?
Which regulatory body handles violations of each related insurance issue only?
TIC - Texas Insurance Code
What license carries the minimum requirements to handle homeowners claims?
What license carries the minimum requirements to handle homeowners claims?
Property, Casualty and Surety
Most workers' comp policies have what type of policy limit?
Most workers' comp policies have what type of policy limit?
None
Which one of the following penalties or remedies is not valid under the DTPA?
Which one of the following penalties or remedies is not valid under the DTPA?
Which one of the following is not a qualification to become an adjuster?
Which one of the following is not a qualification to become an adjuster?
In the mid 1900's insurers shifted focus on claims handling from field adjusting to in-office adjusting. This change in claims handling was known as ________?
In the mid 1900's insurers shifted focus on claims handling from field adjusting to in-office adjusting. This change in claims handling was known as ________?
When the dealers negotiated an agreement on purchasing drugs, they were of age and there was a monetary exchange. Which of the following nullifies this transaction as a 'contract'?
When the dealers negotiated an agreement on purchasing drugs, they were of age and there was a monetary exchange. Which of the following nullifies this transaction as a 'contract'?
Which of the following is not allowed to handle property or auto claims for an insurance carrier?
Which of the following is not allowed to handle property or auto claims for an insurance carrier?
In workers' comp, what is utilized to monitor the frequency of medical visits?
In workers' comp, what is utilized to monitor the frequency of medical visits?
Which of the following is a workers' comp regulatory entity?
Which of the following is a workers' comp regulatory entity?
Which of the following is allowed to handle property claims for an insurance carrier?
Which of the following is allowed to handle property claims for an insurance carrier?
What does IME stand for?
What does IME stand for?
Which of the following is not a source of legal liability?
Which of the following is not a source of legal liability?
What is TIC?
What is TIC?
An individual who investigates or adjusts losses or supervises the handling of claims is known as an?
An individual who investigates or adjusts losses or supervises the handling of claims is known as an?
Which of the following is a compensatory damage?
Which of the following is a compensatory damage?
Under the TIC remedies, what is the cap for punitive damages?
Under the TIC remedies, what is the cap for punitive damages?
Which of the following methods to control medical costs would not be included in a workers' comp policy?
Which of the following methods to control medical costs would not be included in a workers' comp policy?
The courts have interpreted that an insured or third-party beneficiary to an insurance policy can be recognized as a __________ under the TIC.
The courts have interpreted that an insured or third-party beneficiary to an insurance policy can be recognized as a __________ under the TIC.
This position is the insurer's direct representative with the insured, claimant, attorney, etc.
This position is the insurer's direct representative with the insured, claimant, attorney, etc.
What is the best description of a 'competent party'?
What is the best description of a 'competent party'?
The Texas Workers' Comp Act limits a covered employer's liability to a schedule of benefits. Which benefit is not included?
The Texas Workers' Comp Act limits a covered employer's liability to a schedule of benefits. Which benefit is not included?
An emergency licensed adjuster can work for _____________ days before submitting the actual license application.
An emergency licensed adjuster can work for _____________ days before submitting the actual license application.
Workers' comp has how many regulatory entities in Texas?
Workers' comp has how many regulatory entities in Texas?
Which of the following will not likely be involved or included in a workers' comp investigation?
Which of the following will not likely be involved or included in a workers' comp investigation?
What regulatory body or statute handles consumer protection violations of most business-related issues in Texas?
What regulatory body or statute handles consumer protection violations of most business-related issues in Texas?
Pursuant to Texas Insurance Code (TIC), which of the following is not exempt from the requirement of an adjuster's license examination?
Pursuant to Texas Insurance Code (TIC), which of the following is not exempt from the requirement of an adjuster's license examination?
Which of the following is an 'exemplary damage'?
Which of the following is an 'exemplary damage'?
The insurance company function that is responsible for handling payment of claims is?
The insurance company function that is responsible for handling payment of claims is?
What is TDI?
What is TDI?
An insured is also considered a ________ under the DTPA.
An insured is also considered a ________ under the DTPA.
The body of law can be divided into 2 categories. Which of the following is a category?
The body of law can be divided into 2 categories. Which of the following is a category?
Which of the following could be a violation of the Unfair Claims Settlement Practices Act?
Which of the following could be a violation of the Unfair Claims Settlement Practices Act?
The claims adjusting process consists of 3 major elements. Which of the following is NOT one of the elements?
The claims adjusting process consists of 3 major elements. Which of the following is NOT one of the elements?
A person, entity, or organization known as the 2nd party is referred to as the?
A person, entity, or organization known as the 2nd party is referred to as the?
What is DTPA?
What is DTPA?
In a bond transaction, the entity that makes the commitment and is sometimes referred to as the 'obligator' is the?
In a bond transaction, the entity that makes the commitment and is sometimes referred to as the 'obligator' is the?
Courts that have jurisdiction over matters pertaining to the sea are known as ______________ courts.
Courts that have jurisdiction over matters pertaining to the sea are known as ______________ courts.
Most insurance policies are considered two-party contracts, whereas bond transactions usually involve ___________ party(ies).
Most insurance policies are considered two-party contracts, whereas bond transactions usually involve ___________ party(ies).
Which of the following is not a party to a bond?
Which of the following is not a party to a bond?
In a typical homeowners policy, the expense incurred BEYOND the normal daily expense of maintaining a household subsequent to a covered loss would be ___________.
In a typical homeowners policy, the expense incurred BEYOND the normal daily expense of maintaining a household subsequent to a covered loss would be ___________.
The standard fire policy was truly standardized in what year?
The standard fire policy was truly standardized in what year?
In a typical homeowners insurance policy, the price of a 'unit' of insurance determines the exposure to a risk. This is referred to as ____________.
In a typical homeowners insurance policy, the price of a 'unit' of insurance determines the exposure to a risk. This is referred to as ____________.
Inland marine insurance can be classified by all the following except:
Inland marine insurance can be classified by all the following except:
Which of the following statements is most true regarding bonds?
Which of the following statements is most true regarding bonds?
Even though most perils are covered in an 'All-Risk' homeowners policy, what would not be covered?
Even though most perils are covered in an 'All-Risk' homeowners policy, what would not be covered?
What is the amount payable under a homeowners insurance policy with the following facts: 1) 1% deductible, 2) $10,000 loss, 3) $150,000 Coverage A limit?
What is the amount payable under a homeowners insurance policy with the following facts: 1) 1% deductible, 2) $10,000 loss, 3) $150,000 Coverage A limit?
According to most homeowners insurance policies, which of the following is the definition of 'RISK'?
According to most homeowners insurance policies, which of the following is the definition of 'RISK'?
The TSFP is considered a ____________ policy.
The TSFP is considered a ____________ policy.
Homeowner policies are considered ______ policies since they provide both property and liability.
Homeowner policies are considered ______ policies since they provide both property and liability.
How many sections does the HO-2 policy have?
How many sections does the HO-2 policy have?
In a typical homeowners insurance policy, an 'All Risk' (special) policy is usually responsible for _____________.
In a typical homeowners insurance policy, an 'All Risk' (special) policy is usually responsible for _____________.
An adjuster for marine losses is known as?
An adjuster for marine losses is known as?
What peril does the standard fire policy cover?
What peril does the standard fire policy cover?
What type of bond would be required for a contractor to guarantee that a performance bond would be obtained prior to commencement of a job?
What type of bond would be required for a contractor to guarantee that a performance bond would be obtained prior to commencement of a job?
Bailees are one of the most common purchasers of inland marine insurance. What is a bailee?
Bailees are one of the most common purchasers of inland marine insurance. What is a bailee?
The initial fire policy was considered a ___________ policy.
The initial fire policy was considered a ___________ policy.
Inland marine insurance covers all the following except:
Inland marine insurance covers all the following except:
The loss payment provision in an inland marine policy states that the carrier must take action within __________ days of receipt of the proof of loss.
The loss payment provision in an inland marine policy states that the carrier must take action within __________ days of receipt of the proof of loss.
What is covered under Coverage A in the homeowners insurance policy?
What is covered under Coverage A in the homeowners insurance policy?
A mathematical concept that the more times an event is repeated, the more predictable the outcome is known as __________.
A mathematical concept that the more times an event is repeated, the more predictable the outcome is known as __________.
A bond that guarantees that a contractual obligation will be met, such as a debt, duty, and/or commitment is known as a?
A bond that guarantees that a contractual obligation will be met, such as a debt, duty, and/or commitment is known as a?
Heidi is a defendant in a lawsuit and has elected to appeal her verdict. She will need to purchase what bond?
Heidi is a defendant in a lawsuit and has elected to appeal her verdict. She will need to purchase what bond?
What is covered under homeowners policy Coverage B?
What is covered under homeowners policy Coverage B?
The insured has an ACV policy on her residence. The replacement cost of the loss is $10,000 and the depreciation is 25%. What is the amount payable?
The insured has an ACV policy on her residence. The replacement cost of the loss is $10,000 and the depreciation is 25%. What is the amount payable?
What was the year that the first independent policy combined personal liability coverage with packaged property coverages?
What was the year that the first independent policy combined personal liability coverage with packaged property coverages?
The Texas Standard Fire Policy is used exclusively for __________.
The Texas Standard Fire Policy is used exclusively for __________.
According to the typical homeowners policy, what is the payable if the tree is blown onto the dwelling by a covered peril?
According to the typical homeowners policy, what is the payable if the tree is blown onto the dwelling by a covered peril?
Under the ISO homeowners policy, what would be covered under Coverage C?
Under the ISO homeowners policy, what would be covered under Coverage C?
What of the following is not part of most insurance policies and contracts?
What of the following is not part of most insurance policies and contracts?
What coverage pays for lost wages in the Texas PAP?
What coverage pays for lost wages in the Texas PAP?
What coverage pays for household or replacement services if needed due to an injury in an auto accident?
What coverage pays for household or replacement services if needed due to an injury in an auto accident?
What coverage is mandatory to offer to prospective insureds?
What coverage is mandatory to offer to prospective insureds?
When crossing state lines, the auto limit of liability coverage will __________.
When crossing state lines, the auto limit of liability coverage will __________.
Which of the following is not a penalty for violating financial responsibility laws in Texas?
Which of the following is not a penalty for violating financial responsibility laws in Texas?
According to the TPAP, Coverage D is __________.
According to the TPAP, Coverage D is __________.
Regarding liability, Texas is considered a ______ state.
Regarding liability, Texas is considered a ______ state.
Hail damage to an insured vehicle would be paid under what coverage?
Hail damage to an insured vehicle would be paid under what coverage?
ISO stands for?
ISO stands for?
Which of the following perils is not covered under the 'comp coverage'?
Which of the following perils is not covered under the 'comp coverage'?
Coverage C under the TPAP is?
Coverage C under the TPAP is?
AAIS stands for?
AAIS stands for?
___________ contracts and policies are drafted to meet the specific needs of a state, company, and/or policyholder.
___________ contracts and policies are drafted to meet the specific needs of a state, company, and/or policyholder.
TPAP stands for?
TPAP stands for?
According to the TPAP, it will provide liability coverage for any insured __________.
According to the TPAP, it will provide liability coverage for any insured __________.
The TPAP is based on what type of driver?
The TPAP is based on what type of driver?
What contracts or policies are consistent from state to state?
What contracts or policies are consistent from state to state?
A legal term applying to third-party claims meaning to pay back or make whole is?
A legal term applying to third-party claims meaning to pay back or make whole is?
What is not listed on the declarations page of a commercial property policy?
What is not listed on the declarations page of a commercial property policy?
What of the following is not a person identified as a 'premises liability' claimant?
What of the following is not a person identified as a 'premises liability' claimant?
AIC stands for?
AIC stands for?
What form of the commercial property policy is an 'open peril' 'all risk' policy?
What form of the commercial property policy is an 'open peril' 'all risk' policy?
What CGL policy is commonly utilized?
What CGL policy is commonly utilized?
Which of the following is not an element of tort and negligence?
Which of the following is not an element of tort and negligence?
Which of the following is not a type of 'absolute liability'?
Which of the following is not a type of 'absolute liability'?
The commercial property insurance policy utilizes the ______________ coverage.
The commercial property insurance policy utilizes the ______________ coverage.
Which CGL coverage addresses personal injury and advertising injury?
Which CGL coverage addresses personal injury and advertising injury?
The necessary increase in living expense resulting from a loss by a covered peril incurred by the insured is?
The necessary increase in living expense resulting from a loss by a covered peril incurred by the insured is?
What is the statute of limitations for a liability claim in Texas?
What is the statute of limitations for a liability claim in Texas?
Derived from statutory and case law of England and the American colonies, this is known as?
Derived from statutory and case law of England and the American colonies, this is known as?
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Study Notes
Texas Insurance Code and Regulatory Entities
- TIC refers to the Texas Insurance Code, which addresses violations related to insurance issues.
- The Texas Workers' Compensation Commission is a key regulatory entity for workers' compensation matters in Texas.
- The Texas Department of Insurance (TDI) oversees insurance companies, agents, and adjusters.
Licensing and Adjuster Qualifications
- The minimum license required to handle homeowners' claims is Property, Casualty, and Surety.
- Adjusters do not need an MBA in insurance to qualify.
- An emergency licensed adjuster can operate for up to five days before submitting a full license application.
Claims Handling Practices
- Claim centralization marked the transition from field adjusting to in-office claims management in the mid-1900s.
- There are two regulatory entities governing workers' compensation in Texas.
Compensation and Damages
- Compensatory damages are designed to punish wrongdoers, often through punitive measures.
- Under TIC, punitive damages are capped at twice the actual damages.
- The term "consumer" under the DTPA designates an insured individual.
Insurance Policy Features
- Homeowners' policies typically cover living expenses incurred beyond normal costs due to loss, known as Additional Living Expense (ALE).
- The standard fire policy was standardized in 1943 and only covers fire as a peril.
- Homeowners' policies are classified as 'package' policies since they provide both property and liability coverage.
Coverage Specifics
- Coverage A in homeowners policies addresses dwelling, while Coverage B pertains to additional structures like fences.
- The Texas Personal Auto Policy (TPAP) includes mandatory Personal Injury Protection (PIP) coverage.
- Coverage C under TPAP refers to Uninsured Motorist (UM) coverage.
Claims Investigation and Practices
- Utilization review is employed in workers' compensation to monitor medical visit frequencies.
- Adjusters are expected to manage claims, including supervising the handling of property and auto claims.
Legal Principles and Liability
- Indemnification refers to the legal principle of making a party whole in third-party claims.
- Texas operates under comparative negligence laws concerning liability claims.
Miscellaneous Facts
- The law of large numbers states that the predictability of outcomes increases with repeated events.
- Common law originates from both statutory and case law established in England and American colonies.
- The statute of limitations for liability claims in Texas is set at two years.
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