ILLINOIS PUBLIC ADJUSTER TEST PAPER 2025/2026
QUESTIONS AND ANSWERS GRADED A+
✔✔difference between short rate and pro-rata - ✔✔penalty for cancelling while prorate
gives full refund
✔✔entire contract clause - ✔✔limited to terms of contract
✔✔fiduciary - ✔✔a person who holds assets in trust for a beneficiary
✔✔law of agency - ✔✔The law that governs the relationship between a principal and his
or her agent.
✔✔liberalization clause - ✔✔is an insurance policy provision that allows for additional
coverage or benefits to be added to an existing policy without requiring the policyholder
to pay more.
✔✔limit of liability - ✔✔most that will be payed
✔✔loss reserves - ✔✔sum of money set aside to meet future obligations
✔✔other insurance provision - ✔✔defines how each policy will pay
✔✔policy inception - ✔✔The actual date, and in some cases the hour, in which the
policy goes into effect.
✔✔policy expiration - ✔✔The actual date that the policy is no longer in effect
✔✔Policy Provisions - ✔✔clauses in insurance how coverage applies
✔✔policy period - ✔✔when the policy begins and ends
✔✔policy territory - ✔✔Defines the location where coverage will be provided.
✔✔Proof of loss (POL) - ✔✔A statement of facts about a loss for which the insured is
making a claim.
✔✔Subrogation clause - ✔✔allows an insurer to step into the shoes of the policyholder
and file a claim against a third party who caused the damage.
✔✔voided policy - ✔✔like it never existed
✔✔suspended policy - ✔✔temporary suspension
, ✔✔cancelled policy - ✔✔cancelled completely for a reason
✔✔certificate of authority - ✔✔grants power to write contacts of insurance in state
✔✔admitted/ authorized - ✔✔insurer is authorized by this State's Commissioner of
Insurance to do business in this State once they have certificate of authority
✔✔surplus line companies - ✔✔companies with no certificate of authority. Not admitted
✔✔what does the State Guaranty Association do? - ✔✔protects insurance policyholders
from financial losses if their insurance company becomes insolvent. SGAs are non-profit
organizations that ensure policyholders continue to receive coverage up to state-
specified limits.
✔✔specific coverage - ✔✔separate limits for different purposes
✔✔blanket coverage - ✔✔single limit for similar items
✔✔difference between burglary/robbery/ theft? - ✔✔Burglary- offender entering
Robbery- using force or threat of force
Theft- larceny (taking of property secretly)
✔✔what is typically included in basic form? - ✔✔fire, lightning, internal explosion
✔✔what is typically included in extended coverage? - ✔✔basic form + WCSHAVVER
(Wind, civil, smoke, hail, aircraft, vehicle, volcanic, explosion, riot) VMM (Vandalism and
Malicious mischief
✔✔what is typically included in broad form? - ✔✔basic form + extended + BIG AFFECT
( burglary, ice, glass, accidental discharge of water, freezing, falling objects, electrical
current, collapse, tearing
✔✔what is typically included in special form? - ✔✔open peril coverage
✔✔proximate clause - ✔✔legal cause of loss
✔✔efficient proximate - ✔✔claim w perils dependent on each other
✔✔concurrent clause - ✔✔independent of other perils
✔✔actual total loss - ✔✔a lost beyond repair
✔✔constructive total loss - ✔✔cost to repair is more
QUESTIONS AND ANSWERS GRADED A+
✔✔difference between short rate and pro-rata - ✔✔penalty for cancelling while prorate
gives full refund
✔✔entire contract clause - ✔✔limited to terms of contract
✔✔fiduciary - ✔✔a person who holds assets in trust for a beneficiary
✔✔law of agency - ✔✔The law that governs the relationship between a principal and his
or her agent.
✔✔liberalization clause - ✔✔is an insurance policy provision that allows for additional
coverage or benefits to be added to an existing policy without requiring the policyholder
to pay more.
✔✔limit of liability - ✔✔most that will be payed
✔✔loss reserves - ✔✔sum of money set aside to meet future obligations
✔✔other insurance provision - ✔✔defines how each policy will pay
✔✔policy inception - ✔✔The actual date, and in some cases the hour, in which the
policy goes into effect.
✔✔policy expiration - ✔✔The actual date that the policy is no longer in effect
✔✔Policy Provisions - ✔✔clauses in insurance how coverage applies
✔✔policy period - ✔✔when the policy begins and ends
✔✔policy territory - ✔✔Defines the location where coverage will be provided.
✔✔Proof of loss (POL) - ✔✔A statement of facts about a loss for which the insured is
making a claim.
✔✔Subrogation clause - ✔✔allows an insurer to step into the shoes of the policyholder
and file a claim against a third party who caused the damage.
✔✔voided policy - ✔✔like it never existed
✔✔suspended policy - ✔✔temporary suspension
, ✔✔cancelled policy - ✔✔cancelled completely for a reason
✔✔certificate of authority - ✔✔grants power to write contacts of insurance in state
✔✔admitted/ authorized - ✔✔insurer is authorized by this State's Commissioner of
Insurance to do business in this State once they have certificate of authority
✔✔surplus line companies - ✔✔companies with no certificate of authority. Not admitted
✔✔what does the State Guaranty Association do? - ✔✔protects insurance policyholders
from financial losses if their insurance company becomes insolvent. SGAs are non-profit
organizations that ensure policyholders continue to receive coverage up to state-
specified limits.
✔✔specific coverage - ✔✔separate limits for different purposes
✔✔blanket coverage - ✔✔single limit for similar items
✔✔difference between burglary/robbery/ theft? - ✔✔Burglary- offender entering
Robbery- using force or threat of force
Theft- larceny (taking of property secretly)
✔✔what is typically included in basic form? - ✔✔fire, lightning, internal explosion
✔✔what is typically included in extended coverage? - ✔✔basic form + WCSHAVVER
(Wind, civil, smoke, hail, aircraft, vehicle, volcanic, explosion, riot) VMM (Vandalism and
Malicious mischief
✔✔what is typically included in broad form? - ✔✔basic form + extended + BIG AFFECT
( burglary, ice, glass, accidental discharge of water, freezing, falling objects, electrical
current, collapse, tearing
✔✔what is typically included in special form? - ✔✔open peril coverage
✔✔proximate clause - ✔✔legal cause of loss
✔✔efficient proximate - ✔✔claim w perils dependent on each other
✔✔concurrent clause - ✔✔independent of other perils
✔✔actual total loss - ✔✔a lost beyond repair
✔✔constructive total loss - ✔✔cost to repair is more
