FREE Property & Casualty Insurance License Trivia Questions and Answers
Taylor's home was completely lost after a fire completely destroyed it. In order to examine the damage and possibly get a check to pay his damages, Taylor phoned his insurance company. Taylor was in charge of providing a list of all the damaged personal stuff he lost in the fire to his insurance provider. Taylor added the computer to the list to have the insurance company pay for a replacement even though he was aware it was in his car at the time of the fire and was undamaged. Which risk is Taylor responsible for?
Explanation:
By telling his insurance company a lie in order to get money for a new computer, Taylor engaged in a moral hazard. Taylor lied to make money off of his fire loss even though he knew his actions were wrong. If a moral hazard is discovered, the insurance provider may decide to completely reject the claim or pay much less than the full amount of the claim.
Can an employee sue their employer under employer liability insurance in addition to making a workers' compensation claim?
Explanation:
One of the two claims covered by an employer's liability insurance is dual capacity. Dual capacity claims enable an employee to pursue coverage through workers' compensation payments as well as legal action against her employer for the injury she suffered. The employee would not only be suing the employer for being her employer and being hurt at work but also in a product liability claim.
Which kind of arbitration has a final decision?
Explanation:
Both parties are required to abide by the arbitrator's ruling in binding arbitration. Some states mandate this kind of arbitration in order for the claim to be resolved.
Employer's liability insurance provides two advantages over workers' compensation insurance, despite the fact that the employee must establish fault. Which two claims categories would not be covered by workers' compensation coverage but would fall under employer liability coverage?
Explanation:
Both claims involving dual capacity and third-party overrepresentation are eligible for coverage under employer's liability insurance, but not under workers' compensation. When an employee sues a third party for her injuries, third-party-over coverage is applicable. Dual capacity claims entail an injured employee suing his company in addition to filing a workers' compensation claim, through a product liability lawsuit.
Does non-binding arbitration always produce a "winner" at the end?
Explanation:
The "winning" in non-binding arbitration is not necessarily the outcome; both parties are free to reject the arbitrator's decision. However, the "winner" will have the advantage of being able to claim victory at upcoming hearings before an arbitrator or court appearances.
An insured may obstruct subrogation in any of the following methods, EXCEPT:
Explanation:
After a loss, one of the insured's responsibilities is to help the insurance company out with any paperwork or evidence of loss requirements. However, the insured must refrain from interfering with the subrogation procedure or risk being held liable for whatever money the carrier might have been able to recover from the negligent party.
Which exception to the exclusive remedy approach requires employees to demonstrate employer negligence in order to receive compensation for an accident sustained at work?
Explanation:
To be eligible for benefits under an employer's liability insurance, an employee must demonstrate that his or her employer was negligent in order to sustain an injury at work. For workers' compensation, which often does not need the establishment of fault, this is an exception to the rule. In situations where employees are not protected by workers' compensation legislation, employers' liability coverage is used.