Georgia Adjuster Practice Test

Agent Rice's request for motor vehicle records demonstrates his:

1. Express authority

2. Implied authority

3. Apparent authority

4. Inherent authority

The correct answer is: Implied authority

Agent Rice's request for motor vehicle records illustrates the concept of implied authority. Implied authority refers to the power a principal (in this case, an insurance company or similar entity) gives to an agent to perform tasks that, while not specifically outlined in a formal agreement, are necessary for executing the duties of the role. In this scenario, obtaining motor vehicle records is often a standard part of conducting investigations or processing claims within the insurance field. While not explicitly stated in the agent's contract or agreement, it is a reasonable and expected task that aligns with typical responsibilities of an agent. Thus, exercising implied authority allows Agent Rice to perform actions that further the interests of his principal and fulfill ongoing business transactions. Understanding implied authority is important because it encompasses the idea that an agent can engage in actions crucial to their role without needing explicit approval for every single task, as long as those actions are consistent with the agent's responsibilities or the operations of the agency.