Los Angeles Claims Adjuster Property and Causality Practice Exam

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Study for the Los Angeles Claims Adjuster Exam. Prepare with flashcards and multiple choice questions, each question has hints and explanations. Get ready for your exam!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

FAIR Plans are part of which market category in insurance?

Standard market
High-risk market
Residual market
Private market

The correct answer is: Residual market

FAIR Plans, which stand for Fair Access to Insurance Requirements Plans, are specifically designed to provide insurance coverage to individuals and properties that are considered high-risk and may not be able to obtain coverage through the standard insurance market. These plans are a vital part of the residual or surplus lines market, which caters to those who are unable to find coverage in the ordinary market due to various factors like geographical location, property type, or previous claims history. In the context of insurance, the residual market serves to ensure that individuals and businesses still have access to necessary coverage, even when they don’t qualify for standard insurance policies. FAIR Plans are essential in this market as they operate as a safety net for high-risk policyholders by providing basic property insurance coverage to those who might otherwise be uninsurable. By ensuring that these individuals have access to insurance, FAIR Plans help reduce the financial impact of disasters and promote stability within the insurance market as a whole.