Alabama Adjusters License Exam Questions and Answers (verified answers) 361 Questions
Question : Accident Insurance
CORRECT ANSWER : Covers expenses associated with a
covered accident and can extend to ambulance and emergency room expenses, intensive care, and hospital costs. Accident insurance also provides for loss of income, and a death benefit if injuries prove fatal
Question : Accumulated Depreciation
CORRECT ANSWER : The total decrease in an item's value
over a period of time. Formula: (annual depreciation x
number of years used). Subtract this number from the item's replacement cost to get its actual cash value (ACV).
Question : Acreage Reporting Date
CORRECT ANSWER : In crop insurance, the deadline for
providing the insurer with an acreage report, which is used to determine the amount of coverage needed and the premium charged for a particular crop.
Question : Actual Cash Value (ACV)
CORRECT ANSWER : A valuation method used by insurers
to reflect an item's current market value right before being
damaged or destroyed. Formula: (replacement cost -
accumulated depreciation)
Question : Actual Production History
CORRECT ANSWER : A history of a farmer's crop yields
over a multi-year period, which is used to determine the normal production level of a farm.
Question : Adhesion
CORRECT ANSWER : Characteristic of an insurance
contract. Means that one party (the insurer) sets the terms, and the other (the policyholder) can "take it or leave it.
Question : Adjusted Gross Revenue (Crop Insurance)
CORRECT ANSWER : Narrowest (and least expensive)
form of crop revenue insurance. Insures farm revenue as a
whole instead of individual crops. Guarantees a percentage of the insured farm's average revenue.
Question : Adjuster
CORRECT ANSWER : An agent who, for compensation,
processes insurance claims. The adjuster investigates the damages, evaluates the claim, and makes a fair and equitable settlement based on the insurance contract. Can represent either the insured or the insurer.
Question : Adjuster - Emergency
CORRECT ANSWER : Adjusters who are temporarily
licensed by the insurance commissioner to handle claims during catastrophes or emergencies that produce an overwhelming number of claims in a short period of time.
Question : Adjuster - Independent
CORRECT ANSWER : Self-employed adjusters who
contract with multiple insurers at the same time. Paid on a commission or fee-plus-expenses basis for each claim. Also
called: Fee Adjuster, Bureau Adjuster.
Question : Adjuster - Public
CORRECT ANSWER : An adjuster who is hired to represent
the claimant and help determine a fair indemnification.Usually specializes in appraisals and negotiation. Paid commission, usually a percentage of final settlement.
Question : Adjuster - Staff
CORRECT ANSWER : Salaried employee of one insurance
company who can work locally, regionally, or nationally.
Also called: Company Adjuster
Question : Advance Payment Settlement
CORRECT ANSWER : A settlement option that lets the
insurer offer some financial relief to the claimant before the claim has been fully settled. The insurer makes advance payments to the claimant, which are then subtracted from the final settlement amount. Often used when a claimant suffers bodily injury and is unable to work.