CCA Insurance Policies and Coverage 2

Question 1

A homeowner's policy includes a 'replacement cost' endorsement. The insured's 10-year-old roof is destroyed. How should the adjuster calculate the payment?

Accepted Answer

Pay full cost to replace the roof with new materials, no depreciation deduction

Answer

A replacement cost endorsement eliminates the depreciation deduction, so the insurer pays the full cost to replace the damaged property with new materials of like kind and quality.

Question 2

Which clause in a liability policy requires the insurer to defend the insured against covered claims even if the allegations are groundless?

Accepted Answer

Duty to defend clause

Answer

The duty to defend clause obligates the insurer to provide a legal defense for the insured for any claim that falls within the policy's coverage territory, even if the suit is ultimately found to be groundless.

Question 3

Under an occurrence-based liability policy, coverage is triggered when:

Accepted Answer

The bodily injury or property damage occurs during the policy period

Answer

An occurrence-based policy is triggered by the date the injury or damage actually happens, regardless of when the claim is reported or lawsuit is filed.

Question 4

A business auto policy's Symbol 1 (Any Auto) designation means coverage applies to:

Accepted Answer

All autos owned, hired, borrowed, or used in the business

Answer

Symbol 1 is the broadest designation, extending coverage to any auto used in connection with the business, including owned, non-owned, and hired vehicles.

Question 5

What is the primary purpose of a 'subrogation waiver' endorsement requested by a tenant?

Accepted Answer

To prevent the landlord's insurer from suing the tenant after paying a covered loss

Answer

A waiver of subrogation endorsement on the landlord's property policy prevents the insurer from exercising its subrogation rights against the tenant after paying a covered claim caused by the tenant.

(CCA) Certified Claims Adjuster Practice Test

(CCA) Certified Claims Adjuster Practice Test

CCA Insurance Policies and Coverage 2