Practice Quiz

Paralegal

Category - Legal System

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A homeowner in Indiana obtained a homeowner’s insurance policy from an insurance company in Illinois. The homeowner filed a $100,000 claim with the insurance company after the home was severely damaged by a severe storm. The insurance company denied the claim, and the homeowner sued in Indiana state court. The insurance company then filed the appropriate documents to have the case transferred to federal court. This is an example of __________________.
  1. Diversity jurisdiction.
  2. Removal jurisdiction.
  3. Appellate jurisdiction.
  4. Original jurisdiction.
Explanation
Answer: B - Removal jurisdiction. U.S. District Courts have removal jurisdiction to hear and decide cases originally filed in state court if the district court has subject matter jurisdiction (either federal question or diversity jurisdiction) over the removal claim. Here, the federal district court had subject-matter jurisdiction because diversity of citizenship jurisdiction existed.
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