Chapter 5 - Insurance Claims Adjusting
Exam Questions with Correct Answers
2025/2026 Already Graded A+.
Insurance Adjuster - ANS-Any individual who, for compensation, fee or commission,
investigates and settles claims arising under property, casualty or surety contracts on behalf of
the insurer or insured.
Types of insurance Adjusters - ANS-1. Company Adjuster 2. Public Adjuster
Company Adjuster - ANS-Adjuster representing the interests of the insurer, including
independent contractors and salaried employees of the insurer.
Public Adjuster - ANS-An independent contractor representing solely the financial interests of
the insured named in the policy. The insured, and not the insurance company pays the adjuster.
Multiple licensing - ANS-An individual may be licensed concurrently under separate licenses as
a company and public adjuster but may not act as both types of adjuster with respect to the
same claim.
Relationship to the Legal Profession - ANS-Once the claimant has hired the services of an
attorney, the adjuster may no longer contact the claimant w/o the consent/presence of said
attorney. Often the adjuster must negotiate with an attorney towards the final disposition of the
claim. Attorneys representing the insurance company prepare releases for processing by
adjusters.
Fiduciary Agent - ANS-The adjuster is a Fiduciary Agent. This relationship must maintain a high
degree of fidelity and loyalty to the interest of the principal (Insurer) whether or not the adjuster
is a direct employee. As a fiduciary agent of the principal, the adjuster should not deal in any
way with the principals property with motives of self-interest. The adjuster should not represent
interests that are averse to those of the principal and should not profit or seek to profit from any
outside source.
Power to Bind - ANS-Once and adjuster is appointed, the claimant/Insured has the right to
assume the adjuster has the power to ascertain the amount of the loss and settle it. If there are
any limitations on the authority of the adjuster the insured is not bound unless there is
knowledge of said limit of authority. While an adjusters power to bind an insurer to an agreement
, made w/ a claimant varies by type of adjuster, the adjuster is considered the agent of the insurer
and is empowered to make agreements regarding value and loss on its behalf.
Duties of the insured - ANS-Insured is required to report a claim to the company as soon as
practical. The insured usually reports to their agent who provides the claim forms. The insured
use also preserved the undamaged property to the best of their ability to avoid additional loss.
Proof of Loss - ANS-A formal statement made by the insured to the insurance company
regarding a loss. The purpose is to provide sufficient info concerning the loss to enable it to
determine liability under the policy/bond.
Special requirements/ Production of Books & records/ Abandonments - ANS-The insured must
fully cooperate w/ the insurance company by offering testimony or other evidence including the
production of book/records. The insured must separate the damaged from the undamaged
property. The insured cannot simply abandon the property to the insurance company.
Duties of the insurer - Investigation - ANS-It is the responsibility of the insurer to provide a
thorough investigation of the claim and to keep adequate documentation of the investigation
Claims investigation - ANS-A duty performed by the insurance company to perform on behalf of
the insured and to also protect the interest of the insurance company. Each insurance policy
contains a clause that outlines the duties of the insurance company. This is found in the insuring
agreement in most liability policies. State laws requires that the claim be handled "Promptly"
Claim file Documentation of events - ANS-Each company has its own claim procedures and
methods of documentation. Records must be kept in such a form to present to an insurance
examiner shoulder the occasion arise. Such files must contain all notes and paperwork
pertaining to the claim in such detail that pertinent events and dates of such events can be
reconstructed.
Standards for the Acknowledgement of Pertinent Communications - ANS-A. Acknowledgment
of Notices of Claim. B. Answer of Inquiries from Insurance Department C. Replies to Other
Pertinent communications D. Provision of Assistance to first party claimants
A. Acknowledgment of Notices of claim - ANS-Every insurer, upon receiving notification of a
claim must, within a specific number of working days, acknowledge the receipt of such notice
unless payment is made within such period of time. If an acknowledgement is made by means
other than writing and appropriate notation of such acknowledgment must be made in the claim
file of the insurer and dated. Notification given to an agent of an insurer will be considered
notification to the insurer.
B. Answer of Inquiries from Insurance Department - ANS-Every insurer, upon receiving
notification of a claim must, within a specific number of working days, furnish the department
with a response to the inquiry
Exam Questions with Correct Answers
2025/2026 Already Graded A+.
Insurance Adjuster - ANS-Any individual who, for compensation, fee or commission,
investigates and settles claims arising under property, casualty or surety contracts on behalf of
the insurer or insured.
Types of insurance Adjusters - ANS-1. Company Adjuster 2. Public Adjuster
Company Adjuster - ANS-Adjuster representing the interests of the insurer, including
independent contractors and salaried employees of the insurer.
Public Adjuster - ANS-An independent contractor representing solely the financial interests of
the insured named in the policy. The insured, and not the insurance company pays the adjuster.
Multiple licensing - ANS-An individual may be licensed concurrently under separate licenses as
a company and public adjuster but may not act as both types of adjuster with respect to the
same claim.
Relationship to the Legal Profession - ANS-Once the claimant has hired the services of an
attorney, the adjuster may no longer contact the claimant w/o the consent/presence of said
attorney. Often the adjuster must negotiate with an attorney towards the final disposition of the
claim. Attorneys representing the insurance company prepare releases for processing by
adjusters.
Fiduciary Agent - ANS-The adjuster is a Fiduciary Agent. This relationship must maintain a high
degree of fidelity and loyalty to the interest of the principal (Insurer) whether or not the adjuster
is a direct employee. As a fiduciary agent of the principal, the adjuster should not deal in any
way with the principals property with motives of self-interest. The adjuster should not represent
interests that are averse to those of the principal and should not profit or seek to profit from any
outside source.
Power to Bind - ANS-Once and adjuster is appointed, the claimant/Insured has the right to
assume the adjuster has the power to ascertain the amount of the loss and settle it. If there are
any limitations on the authority of the adjuster the insured is not bound unless there is
knowledge of said limit of authority. While an adjusters power to bind an insurer to an agreement
, made w/ a claimant varies by type of adjuster, the adjuster is considered the agent of the insurer
and is empowered to make agreements regarding value and loss on its behalf.
Duties of the insured - ANS-Insured is required to report a claim to the company as soon as
practical. The insured usually reports to their agent who provides the claim forms. The insured
use also preserved the undamaged property to the best of their ability to avoid additional loss.
Proof of Loss - ANS-A formal statement made by the insured to the insurance company
regarding a loss. The purpose is to provide sufficient info concerning the loss to enable it to
determine liability under the policy/bond.
Special requirements/ Production of Books & records/ Abandonments - ANS-The insured must
fully cooperate w/ the insurance company by offering testimony or other evidence including the
production of book/records. The insured must separate the damaged from the undamaged
property. The insured cannot simply abandon the property to the insurance company.
Duties of the insurer - Investigation - ANS-It is the responsibility of the insurer to provide a
thorough investigation of the claim and to keep adequate documentation of the investigation
Claims investigation - ANS-A duty performed by the insurance company to perform on behalf of
the insured and to also protect the interest of the insurance company. Each insurance policy
contains a clause that outlines the duties of the insurance company. This is found in the insuring
agreement in most liability policies. State laws requires that the claim be handled "Promptly"
Claim file Documentation of events - ANS-Each company has its own claim procedures and
methods of documentation. Records must be kept in such a form to present to an insurance
examiner shoulder the occasion arise. Such files must contain all notes and paperwork
pertaining to the claim in such detail that pertinent events and dates of such events can be
reconstructed.
Standards for the Acknowledgement of Pertinent Communications - ANS-A. Acknowledgment
of Notices of Claim. B. Answer of Inquiries from Insurance Department C. Replies to Other
Pertinent communications D. Provision of Assistance to first party claimants
A. Acknowledgment of Notices of claim - ANS-Every insurer, upon receiving notification of a
claim must, within a specific number of working days, acknowledge the receipt of such notice
unless payment is made within such period of time. If an acknowledgement is made by means
other than writing and appropriate notation of such acknowledgment must be made in the claim
file of the insurer and dated. Notification given to an agent of an insurer will be considered
notification to the insurer.
B. Answer of Inquiries from Insurance Department - ANS-Every insurer, upon receiving
notification of a claim must, within a specific number of working days, furnish the department
with a response to the inquiry
