NC ADJUSTER PRACTICE
EXAMINATION 2026 QUESTIONS
WITH ANSWERS GRADED A+
◍ speculative risk.
Answer: when there is a chance of gain as well as a chance of loss (i.e.
gambling, buying a stock)
◍ Manny is purchasing a Commercial Property policy with a Business Income
form included. Manny can select from any of the following as a method to
provide coverage, while avoiding the coinsurance requirement, EXCEPT:.
Answer: The maximum monthly limit of indemnity optional coverage
◍ The traditional definition of actual cash value (ACV) is:.
Answer: Replacement cost minus depreciation
◍ pure risk.
Answer: risk when there is a chance of only loss; the subject of insurance
protection
◍ Sam and Dan are working to clean out the gutters around the roof on Sam's
house. Sam and Dan are standing at the top of separate ladders that are
propped against the side of Sam's house, when Dan's ladder begins to
wobble and ultimately falls into Sam's ladder. Both men and their ladders
crash to the ground. Whose injuries will be covered by Sam's Homeowners
policy under Coverage E - Personal Liability?.
Answer: Only Dan's injuries would be covered
◍ insurable risk.
Answer: risk that an insurance company is willing to accept and has the
following characteristics1. low probability of occurring2. less than
catastrophic results3. the loss must be measurable4. the loss must be
, significant5. the loss must be accidental and unintended
◍ Torts that can be covered by insurance policies include all of the following,
EXCEPT:.
Answer: Intentional torts purposely committed to cause harm to another.
◍ The insured has a $1,000,000 personal umbrella policy with a $5,000
retention limit. For a $7,000 liability loss not covered under the insured's
personal auto policy, but covered under the umbrella policy, the insurance
company would pay:.
Answer: $2,000
◍ All of the following is considered an "insured" under a CGL policy,
EXCEPT:.
Answer: Lawyers of the named insured
◍ What specific type of liability policy gives an owner protection against
liability claims arising out of the acts of its independent contractors?.
Answer: Owners and Contractors Protective Liability Policy.
◍ Which of the following would be eligible for coverage under a
Businessowners policy?.
Answer: A small retail store
◍ Which of the following is NOT a correct statement in determining the cost
of a "comparable automobile" when a physical damage loss has a occurred?.
Answer: The cost of a comparable automobile as determined by a
computerized automobile valuation service that produces statistically valid
fair market values within the United States market
◍ hazard.
Answer: increase the probability of a peril occurring
◍ physical hazard.
Answer: hazard that deals with structure (i.e. faulty wiring)
◍ All of the following statements are TRUE of North Carolina automobile
liability policies, EXCEPT.
, Answer: If the insured carries limits greater than the minimum financial
responsibility limits required by state law, they are not required to carry
Uninsured/Underinsured Motorists coverage.
◍ peril.
Answer: cause of loss
◍ principal of indemnity.
Answer: Insured is intended to be restored to the same financial or economic
condition that existed prior to the loss
◍ insurable interest.
Answer: Any financial interest in life or property such that, if the life or
property were lost or harmed, the insured would suffer financially
◍ deductible.
Answer: Amount you must pay before you begin receiving any benefits
from your insurance company; always pay on direct loss and never pay on
indirect loss or liability (retention)
◍ direct loss.
Answer: a financial loss that results from the physical damage, destruction,
or theft of the property (house, detached garage, contents)
◍ indirect loss.
Answer: a financial loss that results indirectly from the occurrence of a
direct physical damage or theft loss (loss of rental income and incurring
additional expenses to live elsewhere)
◍ The basic limit for Coverage F -- Medical Payments of the standard
Homeowners forms is:.
Answer: $1,000 per person
◍ named peril.
Answer: A specific cause of loss listed and described in an insurance policy;
burden of proof is on insured
◍ open peril.
EXAMINATION 2026 QUESTIONS
WITH ANSWERS GRADED A+
◍ speculative risk.
Answer: when there is a chance of gain as well as a chance of loss (i.e.
gambling, buying a stock)
◍ Manny is purchasing a Commercial Property policy with a Business Income
form included. Manny can select from any of the following as a method to
provide coverage, while avoiding the coinsurance requirement, EXCEPT:.
Answer: The maximum monthly limit of indemnity optional coverage
◍ The traditional definition of actual cash value (ACV) is:.
Answer: Replacement cost minus depreciation
◍ pure risk.
Answer: risk when there is a chance of only loss; the subject of insurance
protection
◍ Sam and Dan are working to clean out the gutters around the roof on Sam's
house. Sam and Dan are standing at the top of separate ladders that are
propped against the side of Sam's house, when Dan's ladder begins to
wobble and ultimately falls into Sam's ladder. Both men and their ladders
crash to the ground. Whose injuries will be covered by Sam's Homeowners
policy under Coverage E - Personal Liability?.
Answer: Only Dan's injuries would be covered
◍ insurable risk.
Answer: risk that an insurance company is willing to accept and has the
following characteristics1. low probability of occurring2. less than
catastrophic results3. the loss must be measurable4. the loss must be
, significant5. the loss must be accidental and unintended
◍ Torts that can be covered by insurance policies include all of the following,
EXCEPT:.
Answer: Intentional torts purposely committed to cause harm to another.
◍ The insured has a $1,000,000 personal umbrella policy with a $5,000
retention limit. For a $7,000 liability loss not covered under the insured's
personal auto policy, but covered under the umbrella policy, the insurance
company would pay:.
Answer: $2,000
◍ All of the following is considered an "insured" under a CGL policy,
EXCEPT:.
Answer: Lawyers of the named insured
◍ What specific type of liability policy gives an owner protection against
liability claims arising out of the acts of its independent contractors?.
Answer: Owners and Contractors Protective Liability Policy.
◍ Which of the following would be eligible for coverage under a
Businessowners policy?.
Answer: A small retail store
◍ Which of the following is NOT a correct statement in determining the cost
of a "comparable automobile" when a physical damage loss has a occurred?.
Answer: The cost of a comparable automobile as determined by a
computerized automobile valuation service that produces statistically valid
fair market values within the United States market
◍ hazard.
Answer: increase the probability of a peril occurring
◍ physical hazard.
Answer: hazard that deals with structure (i.e. faulty wiring)
◍ All of the following statements are TRUE of North Carolina automobile
liability policies, EXCEPT.
, Answer: If the insured carries limits greater than the minimum financial
responsibility limits required by state law, they are not required to carry
Uninsured/Underinsured Motorists coverage.
◍ peril.
Answer: cause of loss
◍ principal of indemnity.
Answer: Insured is intended to be restored to the same financial or economic
condition that existed prior to the loss
◍ insurable interest.
Answer: Any financial interest in life or property such that, if the life or
property were lost or harmed, the insured would suffer financially
◍ deductible.
Answer: Amount you must pay before you begin receiving any benefits
from your insurance company; always pay on direct loss and never pay on
indirect loss or liability (retention)
◍ direct loss.
Answer: a financial loss that results from the physical damage, destruction,
or theft of the property (house, detached garage, contents)
◍ indirect loss.
Answer: a financial loss that results indirectly from the occurrence of a
direct physical damage or theft loss (loss of rental income and incurring
additional expenses to live elsewhere)
◍ The basic limit for Coverage F -- Medical Payments of the standard
Homeowners forms is:.
Answer: $1,000 per person
◍ named peril.
Answer: A specific cause of loss listed and described in an insurance policy;
burden of proof is on insured
◍ open peril.
