Exam (elaborations)
USAA Licensing Exam Questions and Answers 2024
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Exam of 19 pages for the course USAA at USAA (USAA Licensing Exam)
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USAA Licensing ExamInsurance - answer Transfer of risk from one person or organization to an insurance
company
Indemnity - answer The principle to restore the insured to the pre-loss economic or
financial condition.
Law of Large numbers - answer Mathematical principle used by insurers to predict
losses to charge the appropriate premiums
Insurable Interest - answer Proof that someone stands to lose financially if a loss
occurs; must exist at the time of the loss in property and casualty insurance
Binder - answer Temporary insurance contract; commits the company to act as if a
policy has been issued
Peril - answer Cause of loss
Direct Loss - answerImmediate actual physical damage to tangible property
Indirect loss - answerInability to use property as a result of a direct loss
Risk - answerChance of loss; uncertainty of loss
What are the two types of risk? - answerSpeculative and Pure
Speculative Risk - answerInvolves the simultaneous chance of gain or loss: is not
insurable
Pure Risk - answera risk that presents the chance of loss but no opportunity for gain
(insurable)
What are two examples of speculative risk? - answerGambling
Investing
What is an example of your risk? - answerCar accident
Physical hazards include - answerVisible condition that increases the chance of loss
Morale Hazard - answerAttitude of carelessness or indifference to loss
,Insurer - answerThe insurance company (a.k.a. second party to the contract)
Named Insured - answerA party named on the declarations who is purchasing the
insurance policy (a.k.a. first party to the contract)
Insured - answerWho the insurer promises to protect in addition to the named insured
Limit of Liability - answerThe maximum amount that can be paid for a covered loss
Consideration - answerAn exchange of value between parties to a contract
Waiver - answerThe voluntary relinquishment of a known right
What is Estopple? - answerWhen an agent tells an insured/makes the statement there
is coverage for a loss when there is no such coverage, then the insurer is prevented
from denying the claim as a result of what precedent?
Concealment - answerInsured or prospect deliberately withholding material information
from the insurer, this voids coverage
Material Misrepresentation - answerInsured or prospect giving incorrect material
information to the insurer, this voids coverage
Warranty - answerA written condition in the policy that must be true at the time of the
loss
Texas Department of Insurance - answerIn Texas, the insurance industry is regulated
by the
Commissioner - answerThe (_______) is appointed by the governor and heads the
Texas Department of Insurance
Adjuster - answerAccording to the Texas Insurance Code, any person who investigates
or adjusts losses, or any person who supervises the handling of claims must be
licensed as an (_______________)
A Staff Adjuster - answerA (_____) is on the payroll of an insurance company and is
paid a salary or by the hour
Independent Adjuster - answerA (___) handles claims for one or more insurance
companies and receives a fee based on time and expense.
Public Adjuster - answerA (__) works on behalf of the insured in negotiating a claim
settlement. In Texas a (______) requires another separate license called a "public
adjusters license".
, Insurance Agent - answerPersons marketing (Selling) insurance products are called
(___)
Alien Insurer - answerAn insurer organized and domiciled outside the United States is
called an (_____)
Domestic Insurer - answerAn insurer organized, admitted, and writing insurance in
Texas is called a (______)
A Foreign Insurer - answerAn insurer domiciled outside the state where she writes
business is called a (____)
Unfair Claim Settlement - answerAn adjuster intentionally lowballs the claim settlement
by offering less than the amount owed to the insured
Unfair Claim Settlement Practices Act - answerAn Agent collects a premium for a policy,
but does not send it to the company and allows a policy to be canceled
Unfair Claims Settlement Practices Act - answerThe insurance company fails to adopt
reasonable standards for processing claims
Unfair Claim Settlement - answerIf an adjuster were to deny a claim without conducting
a reasonable investigation. This would be an example of what type of claim settlement
violation?
Supplemental Coverages - answerThe insurance company defends the insured for a
suit arising out of a covered claim
An unfair claims settlement practice. - answerIf an adjuster were to deny a claim without
providing the policyholder with a reasonable explanation for the denial, this would be an
example of what type of claims settlement practice?
An unfair claims settlement practice - answerIf the adjuster tells the insured that he has
no coverage under a policy when the coverage really exists, this would be an example
of what type of claims settlement practice?
15 days - answerHow many days does an adjust have to acknowledge the claim
15 Business days - answerHow many days does an adjust have to accept or reject the
claim after he receives complete information?
5 calendar days - answerHow many days does an adjuster have to send the check after
he agrees to pay the claim?
What hazards does Standard Fire Protection cover? - answer(FLI)Fire, Lightning,
Internal Explosions
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