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exas Property & Casualty Adjuster Licensing Exam
T
2025 – Questions & Answers with Rationales | 100%
Verified | Graded A+
Student Name:_________________________
ate:_______________
D
Time Limit:120 minutes
Total Questions:250
Instructions
● ead each question carefully.
R
● Select thebestanswer for multiple-choice questions.
● Mark answers on the provided answer sheet.
● Manage time to complete all 250 questions within the 120-minute limit.
● Questions cover homeowners, commercial property, Texas-specific laws, liability, policy
provisions, exclusions, and adjuster ethics.
Homeowners Policies
Case 1: Fire Damage Claim
policyholder submits a claim under an HO-3 policy for fire damage causing $75,000 in dwelling
A
damage and $25,000 in personal property loss. The policy has a $2,000 deductible.
Question 1
What is the primary coverage for the dwelling under an HO-3 policy?
,a) Actual cash value
b) Replacement cost
c) Market value
d) Stated value
b) Replacement cost
O-3 policies provide replacement cost for the dwelling (Coverage A) unless otherwise endorsed. a)
H
ACV applies to some personal property. c) Market value is irrelevant. d) Stated value is used in specialty
policies.
Question 2
Which coverage applies to personal property?
a) Coverage A
b) Coverage B
c) Coverage C
d) Coverage D
c) Coverage C
overage C covers personal property in an HO-3 policy. a) Coverage A is for the dwelling. b) Coverage B
C
is for other structures. d) Coverage D is for loss of use.
Question 3
What is the payable amount for the dwelling damage after the deductible?
a) $75,000
b) $73,000
c) $70,000
d) $77,000
b) $73,000
, 75,000 - $2,000 deductible = $73,000. a) Ignores the deductible. c) Incorrect calculation. d) Adds the
$
deductible.
Question 4
Is fire a covered peril under HO-3?
a) No, excluded
b) Yes, always
c) Only if sudden
d) Only if endorsed
b) Yes, always
ire is a named peril covered under HO-3 policies. a) Fire is not excluded. c) Suddenness is not required.
F
d) No endorsement needed.
ationale for Case 1:HO-3 provides replacement costfor dwellings and named-peril coverage for
R
personal property. Fire is covered, and the deductible reduces the payout.
Commercial Property
Case 2: Water Damage to Retail Store
retail store files a claim under a Commercial Property Policy (CPP) for $120,000 in damage from a
A
burst pipe. The policy has a $5,000 deductible and an 80% coinsurance clause. The building is insured for
$500,000, with a replacement cost of $600,000.
Question 5
What coverage does the CPP provide for the building?
a) Actual cash value
b) Replacement cost
c) Market value
d) Stated value
, b) Replacement cost
PP typically provides replacement cost unless endorsed otherwise. a) ACV may apply to older policies.
C
c) Market value is irrelevant. d) Stated value is for specialty policies.
Question 6
What is the coinsurance penalty, if any?
a) None
b) $15,000
c) $30,000
d) $10,000
a) None
equired insurance = $600,000 × 80% = $480,000. Actual insurance = $500,000, so no penalty applies.
R
Payout = $120,000 - $5,000 deductible = $115,000. b, c, d) Incorrect calculations.
Question 7
Which form is used for this CPP claim?
a) HO-3
b) CP 00 10
c) DP-1
d) NFIP
b) CP 00 10
P 00 10 is the Building and Personal Property Coverage Form for CPP. a) HO-3 is for homeowners. c)
C
DP-1 is for dwellings. d) NFIP is for flood insurance.
Question 8
Is water damage from a burst pipe covered?
a) No, excluded
exas Property & Casualty Adjuster Licensing Exam
T
2025 – Questions & Answers with Rationales | 100%
Verified | Graded A+
Student Name:_________________________
ate:_______________
D
Time Limit:120 minutes
Total Questions:250
Instructions
● ead each question carefully.
R
● Select thebestanswer for multiple-choice questions.
● Mark answers on the provided answer sheet.
● Manage time to complete all 250 questions within the 120-minute limit.
● Questions cover homeowners, commercial property, Texas-specific laws, liability, policy
provisions, exclusions, and adjuster ethics.
Homeowners Policies
Case 1: Fire Damage Claim
policyholder submits a claim under an HO-3 policy for fire damage causing $75,000 in dwelling
A
damage and $25,000 in personal property loss. The policy has a $2,000 deductible.
Question 1
What is the primary coverage for the dwelling under an HO-3 policy?
,a) Actual cash value
b) Replacement cost
c) Market value
d) Stated value
b) Replacement cost
O-3 policies provide replacement cost for the dwelling (Coverage A) unless otherwise endorsed. a)
H
ACV applies to some personal property. c) Market value is irrelevant. d) Stated value is used in specialty
policies.
Question 2
Which coverage applies to personal property?
a) Coverage A
b) Coverage B
c) Coverage C
d) Coverage D
c) Coverage C
overage C covers personal property in an HO-3 policy. a) Coverage A is for the dwelling. b) Coverage B
C
is for other structures. d) Coverage D is for loss of use.
Question 3
What is the payable amount for the dwelling damage after the deductible?
a) $75,000
b) $73,000
c) $70,000
d) $77,000
b) $73,000
, 75,000 - $2,000 deductible = $73,000. a) Ignores the deductible. c) Incorrect calculation. d) Adds the
$
deductible.
Question 4
Is fire a covered peril under HO-3?
a) No, excluded
b) Yes, always
c) Only if sudden
d) Only if endorsed
b) Yes, always
ire is a named peril covered under HO-3 policies. a) Fire is not excluded. c) Suddenness is not required.
F
d) No endorsement needed.
ationale for Case 1:HO-3 provides replacement costfor dwellings and named-peril coverage for
R
personal property. Fire is covered, and the deductible reduces the payout.
Commercial Property
Case 2: Water Damage to Retail Store
retail store files a claim under a Commercial Property Policy (CPP) for $120,000 in damage from a
A
burst pipe. The policy has a $5,000 deductible and an 80% coinsurance clause. The building is insured for
$500,000, with a replacement cost of $600,000.
Question 5
What coverage does the CPP provide for the building?
a) Actual cash value
b) Replacement cost
c) Market value
d) Stated value
, b) Replacement cost
PP typically provides replacement cost unless endorsed otherwise. a) ACV may apply to older policies.
C
c) Market value is irrelevant. d) Stated value is for specialty policies.
Question 6
What is the coinsurance penalty, if any?
a) None
b) $15,000
c) $30,000
d) $10,000
a) None
equired insurance = $600,000 × 80% = $480,000. Actual insurance = $500,000, so no penalty applies.
R
Payout = $120,000 - $5,000 deductible = $115,000. b, c, d) Incorrect calculations.
Question 7
Which form is used for this CPP claim?
a) HO-3
b) CP 00 10
c) DP-1
d) NFIP
b) CP 00 10
P 00 10 is the Building and Personal Property Coverage Form for CPP. a) HO-3 is for homeowners. c)
C
DP-1 is for dwellings. d) NFIP is for flood insurance.
Question 8
Is water damage from a burst pipe covered?
a) No, excluded
