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PSI CA ADJUSTERS LICENSE EXAM QUESTIONS AND ANSWERS WITH EXPLANATION A+ GRADED
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PSI CA ADJUSTERS LICENSE EXAMQUESTIONS AND ANSWERS WITH
EXPLANATION A+ GRADED
Which of the following is covered by a flood policy?
Answer Choices: Select the Correct Answer
Overflow of inland or tidal water
Vehicles
A broken water main
Livestock
Verified Answer -Overflow of inland or tidal water is correct.
EXPLANATION:
Overflow of inland or tidal water is the prime coverage under flood
insurance. Mudflow is also covered. Mudslides are not. The coverage
does not include damage or loss of livestock or roads.
How is personal property of a dwelling covered under a farm policy?
Answer Choices: Select the Correct Answer
Actual Cash Value Basis
Stated Amount Basis
Agreed Amount Basis
Replacement Cost Basis
Verified Answer -The correct answer is: Actual Cash Value Basis.
EXPLANATION:
,The property is covered on an actual cash value basis. Like a homeowner
policy, the replacement cost endorsement may be attached for an
additional premium.
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:
Answer Choices: Select the Correct Answer
Fiduciary Authority
Expressed Authority
Apparent Authority
Implied Authority
Verified Answer -The correct answer is: Implied Authority.
EXPLANATION:
Implied authority is the authority the agent believes he has in order to do
his job properly. In order to write auto insurance, the agent needs to
know what is on the motor vehicle driving record of all the drivers in the
household.
In California an adjuster must post a surety bond. The bond payable to:
Answer Choices: Select the Correct Answer
The people of the State of California
The Insurance Commissioner
The State of California
The insurance company the adjuster works for
Verified Answer -The correct answer is: The people of the State of
California.
EXPLANATION:
,The bond is made payable to the people of the State of California.
Dwelling forms may be used to insure residential structures which:
Answer Choices: Select the Correct Answer
Contain no more than 4 occupancy units.
Have no more than 8 apartments.
Are used as residences and for small retail sales operations.
Are located on farms if no other business is conducted there.
Verified Answer -Contain no more than 4 occupancy units. is correct.
EXPLANATION:
This will vary to some extent by state. The industry standard is no more
than 4 occupancy units.
Which is not true regarding the California FAIR Plan?
Answer Choices: Select the Correct Answer
Producers may bind coverage if they already write the applicant's
homeowner's insurance.
All admitted insurers writing basic property insurance in California are
required to participate in it.
Only properties located in designated brush hazard areas and/or
designated urban areas are eligible for coverage.
Farm risks are not eligible for coverage.
Verified Answer -The correct answer is: Producers may bind coverage if
they already write the applicant's homeowner's insurance. .
, CGL policies are often referred to as "third party" contracts. Which
company would be considered the "third party" in General Construction
Company's policy?
Answer Choices: Select the Correct Answer
Inferno Heating Company, a claimant
We Rip-Em-Off Insurance Company, the insurer
General Construction Company, the insured
We Rip-Em-Off Insurance Company, the insurer and General
Construction Company, the insured
Verified Answer -Inferno Heating Company, a claimant is correct.
EXPLANATION:
The claimant is always the third party in a liability claim.
Which of the following would include a "superseded suretyship rider?"
Answer Choices: Select the Correct Answer
Fidelity bond
Commercial general liability
Bank package
Commercial package
Verified Answer -Fidelity bond is correct.
EXPLANATION:
Superseded suretyship riders are used in fidelity bonding.
Which of the following would be considered uninsured vehicles?
Answer Choices: Select the Correct Answer
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