Alabama Adjusters License Exam
Questions with Verified Answers |
Graded A+
Accident Insurance - ✔✔Covers expenses associated with a covered accident
and can extend to ambulance and emergency room
expenses, intensive care, and hospital costs. Accident insurance also provides
for loss of income, and a
death benefit if injuries prove fatal
Accumulated Depreciation - ✔✔The total decrease in an item's value over a
period of time. Formula: (annual depreciation x number of
years used). Subtract this number from the item's replacement cost to get its
actual cash value (ACV).
Acreage Reporting Date - ✔✔In crop insurance, the deadline for providing the
insurer with an acreage report, which is used to
determine the amount of coverage needed and the premium charged for a
particular crop.
Actual Cash Value (ACV) - ✔✔A valuation method used by insurers to reflect an
item's current market value right before being damaged
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,or destroyed. Formula: (replacement cost - accumulated depreciation)
Actual Production History - ✔✔A history of a farmer's crop yields over a multi-
year period, which is used to determine the normal
production level of a farm.
Adhesion - ✔✔Characteristic of an insurance contract. Means that one party
(the insurer) sets the terms, and the other
(the policyholder) can "take it or leave it.
Adjusted Gross Revenue
(Crop Insurance) - ✔✔Narrowest (and least expensive) form of crop revenue
insurance. Insures farm revenue as a whole
instead of individual crops. Guarantees a percentage of the insured farm's
average revenue.
Adjuster - ✔✔An agent who, for compensation, processes insurance claims. The
adjuster investigates the damages,
evaluates the claim, and makes a fair and equitable settlement based on the
insurance contract. Can
represent either the insured or the insurer.
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,Adjuster - Emergency - ✔✔Adjusters who are temporarily licensed by the
insurance commissioner to handle claims during
catastrophes or emergencies that produce an overwhelming number of claims
in a short period of time.
Adjuster - Independent - ✔✔Self-employed adjusters who contract with
multiple insurers at the same time. Paid on a commission or
fee-plus-expenses basis for each claim. Also called: Fee Adjuster, Bureau
Adjuster.
Adjuster - Public - ✔✔An adjuster who is hired to represent the claimant and
help determine a fair indemnification. Usually
specializes in appraisals and negotiation. Paid commission, usually a percentage
of final settlement.
Adjuster - Staff - ✔✔Salaried employee of one insurance company who can
work locally, regionally, or nationally. Also called:
Company Adjuster
Advance Payment
Settlement - ✔✔A settlement option that lets the insurer offer some financial
relief to the claimant before the claim has
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, been fully settled. The insurer makes advance payments to the claimant, which
are then subtracted from
the final settlement amount. Often used when a claimant suffers bodily injury
and is unable to work.
Agency Authority - ✔✔The agent's authority to act on behalf of someone else
(the principal), usually an insurer. This authority is
derived from the agent's contract with the principal. It can be apparent,
express, or implied
Agency Authority -
Apparent - ✔✔Indirect authority that the agent can reasonably be assumed to
have, based on appearances. If an
adjuster is equipped to represent an insurer (with the insurer's permission),
then an individual can assume
that the adjuster has the authority to act on the insurer's behalf.
Agency Authority -
Express - ✔✔Authority that is expressly given to the agent in writing. Allows the
agent to act on behalf of the principal.
Agency Authority - Implied - ✔✔Authority that an agent possesses by
implication of her behavior, regardless of whether this authority is
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
Questions with Verified Answers |
Graded A+
Accident Insurance - ✔✔Covers expenses associated with a covered accident
and can extend to ambulance and emergency room
expenses, intensive care, and hospital costs. Accident insurance also provides
for loss of income, and a
death benefit if injuries prove fatal
Accumulated Depreciation - ✔✔The total decrease in an item's value over a
period of time. Formula: (annual depreciation x number of
years used). Subtract this number from the item's replacement cost to get its
actual cash value (ACV).
Acreage Reporting Date - ✔✔In crop insurance, the deadline for providing the
insurer with an acreage report, which is used to
determine the amount of coverage needed and the premium charged for a
particular crop.
Actual Cash Value (ACV) - ✔✔A valuation method used by insurers to reflect an
item's current market value right before being damaged
1|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,or destroyed. Formula: (replacement cost - accumulated depreciation)
Actual Production History - ✔✔A history of a farmer's crop yields over a multi-
year period, which is used to determine the normal
production level of a farm.
Adhesion - ✔✔Characteristic of an insurance contract. Means that one party
(the insurer) sets the terms, and the other
(the policyholder) can "take it or leave it.
Adjusted Gross Revenue
(Crop Insurance) - ✔✔Narrowest (and least expensive) form of crop revenue
insurance. Insures farm revenue as a whole
instead of individual crops. Guarantees a percentage of the insured farm's
average revenue.
Adjuster - ✔✔An agent who, for compensation, processes insurance claims. The
adjuster investigates the damages,
evaluates the claim, and makes a fair and equitable settlement based on the
insurance contract. Can
represent either the insured or the insurer.
2|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
,Adjuster - Emergency - ✔✔Adjusters who are temporarily licensed by the
insurance commissioner to handle claims during
catastrophes or emergencies that produce an overwhelming number of claims
in a short period of time.
Adjuster - Independent - ✔✔Self-employed adjusters who contract with
multiple insurers at the same time. Paid on a commission or
fee-plus-expenses basis for each claim. Also called: Fee Adjuster, Bureau
Adjuster.
Adjuster - Public - ✔✔An adjuster who is hired to represent the claimant and
help determine a fair indemnification. Usually
specializes in appraisals and negotiation. Paid commission, usually a percentage
of final settlement.
Adjuster - Staff - ✔✔Salaried employee of one insurance company who can
work locally, regionally, or nationally. Also called:
Company Adjuster
Advance Payment
Settlement - ✔✔A settlement option that lets the insurer offer some financial
relief to the claimant before the claim has
3|Page
©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
, been fully settled. The insurer makes advance payments to the claimant, which
are then subtracted from
the final settlement amount. Often used when a claimant suffers bodily injury
and is unable to work.
Agency Authority - ✔✔The agent's authority to act on behalf of someone else
(the principal), usually an insurer. This authority is
derived from the agent's contract with the principal. It can be apparent,
express, or implied
Agency Authority -
Apparent - ✔✔Indirect authority that the agent can reasonably be assumed to
have, based on appearances. If an
adjuster is equipped to represent an insurer (with the insurer's permission),
then an individual can assume
that the adjuster has the authority to act on the insurer's behalf.
Agency Authority -
Express - ✔✔Authority that is expressly given to the agent in writing. Allows the
agent to act on behalf of the principal.
Agency Authority - Implied - ✔✔Authority that an agent possesses by
implication of her behavior, regardless of whether this authority is
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©JOSHCLAY 2025/2026. YEAR PUBLISHED 2025.
