Texas All Lines Adjuster Exam – 350+ Questions
with Correct Answers
1. Who must be licensed as an adjuster in Texas?
A) An attorney negotiating the settlement of a claim
B) A salaried employee of an authorized insurer adjusting claims for their employer
C) An individual who, for compensation, investigates or adjusts claims on behalf of an insurer
D) A auto body shop owner who provides a repair estimate
Answer: C) An individual who, for compensation, investigates or adjusts claims on behalf of an
insurer ( )
2. How long is a Texas adjuster license valid before it must be renewed?
A) 1 year
B) 2 years
C) 3 years
D) 4 years
Answer: B) 2 years ( )
3. What is the primary purpose of the Texas Department of Insurance (TDI)?
A) To advocate for insurance companies
B) To regulate the insurance industry and protect consumers
C) To set premium rates for all policies
D) To handle all insurance claims directly
Answer: B) To regulate the insurance industry and protect consumers ( )
4. An adjuster must report any change of address to the TDI within how many days?
A) 10 days
B) 30 days
C) 60 days
D) At the time of renewal
Answer: B) 30 days ( )
5. What constitutes a conflict of interest for an adjuster?
A) Working on a claim from their hometown.
B) Having a financial interest in a repair service they recommend.
,C) Adjusting a claim for a large insurer.
D) Using a preferred vendor list.
Answer: B) Having a financial interest in a repair service they recommend. ( )
6. Which action is considered misrepresentation by an adjuster?
A) accurately explaining policy coverage.
B) Falsely identifying themselves as a TDI representative.
C) Providing a fair settlement offer.
D) Taking a statement from a witness.
Answer: B) Falsely identifying themselves as a TDI representative. ( )
7. The Texas Insurance Code and the Commissioner’s Rules are found in:
A) The Texas Claim Adjuster Manual
B) The Texas Administrative Code (TAC)
C) The Underwriters Handbook
D) The Policy Provisions Guide
Answer: B) The Texas Administrative Code (TAC) ( )
8. An adjuster is permitted to accept a fee for referrals to which of the following?
A) A public insurance adjuster
B) An attorney
C) An auto glass company
D) None of the above; this is prohibited.
Answer: D) None of the above; this is prohibited. ( )
9. What is the maximum penalty for acting as an adjuster without a license in Texas?
A) $1,000 per violation
B) $5,000 per violation
C) $10,000 per violation
D) $50,000 per violation
Answer: D) $50,000 per violation ( )
10. An adjuster's license can be denied, suspended, or revoked for all of the following EXCEPT:
A) Material misrepresentation on the license application
B) Having a felony conviction involving moral turpitude
C) Failing to pass the licensing exam on the first attempt
D) Failing to comply with a court child support order
Answer: C) Failing to pass the licensing exam on the first attempt ( )
, 11. What must an adjuster do when first contacting an insured or claimant?
A) Provide their license number only upon request.
B) Identify themselves as an adjuster and provide their license number.
C) Immediately make a settlement offer.
D) Determine if the claimant has an attorney.
Answer: B) Identify themselves as an adjuster and provide their license number. ( )
12. Twisting is best defined as:
A) The fraudulent alteration of an application.
B) Misrepresenting the benefits of a policy to induce someone to lapse or forfeit an existing
policy.
C) Failing to settle a claim promptly.
D) Denying a claim without cause.
Answer: B) Misrepresenting the benefits of a policy to induce someone to lapse or forfeit an
existing policy. ( )
13. Rebating involves:
A) Giving an undisclosed discount not specified in the policy.
B) Returning a premium after a policy cancellation.
C) Reducing a claim payment for depreciation.
D) Offering a gift of insignificant value as a marketing tool.
Answer: A) Giving an undisclosed discount not specified in the policy. ( )
14. A licensee must notify TDI of any administrative action taken against them by another
state within:
A) 10 days
B) 30 days
C) 60 days
D) 6 months
Answer: B) 30 days ( )
15. The duty of good faith and fair dealing requires an insurer to:
A) Pay every claim that is submitted.
B) Treat the insured's interests with equal importance as its own.
C) Always use the insured's preferred contractor.
D) Settle claims within 72 hours.
Answer: B) Treat the insured's interests with equal importance as its own. ( )
16. What is the purpose of a "Notice of Claim" letter?
A) It is the insurer's formal denial of a claim.
with Correct Answers
1. Who must be licensed as an adjuster in Texas?
A) An attorney negotiating the settlement of a claim
B) A salaried employee of an authorized insurer adjusting claims for their employer
C) An individual who, for compensation, investigates or adjusts claims on behalf of an insurer
D) A auto body shop owner who provides a repair estimate
Answer: C) An individual who, for compensation, investigates or adjusts claims on behalf of an
insurer ( )
2. How long is a Texas adjuster license valid before it must be renewed?
A) 1 year
B) 2 years
C) 3 years
D) 4 years
Answer: B) 2 years ( )
3. What is the primary purpose of the Texas Department of Insurance (TDI)?
A) To advocate for insurance companies
B) To regulate the insurance industry and protect consumers
C) To set premium rates for all policies
D) To handle all insurance claims directly
Answer: B) To regulate the insurance industry and protect consumers ( )
4. An adjuster must report any change of address to the TDI within how many days?
A) 10 days
B) 30 days
C) 60 days
D) At the time of renewal
Answer: B) 30 days ( )
5. What constitutes a conflict of interest for an adjuster?
A) Working on a claim from their hometown.
B) Having a financial interest in a repair service they recommend.
,C) Adjusting a claim for a large insurer.
D) Using a preferred vendor list.
Answer: B) Having a financial interest in a repair service they recommend. ( )
6. Which action is considered misrepresentation by an adjuster?
A) accurately explaining policy coverage.
B) Falsely identifying themselves as a TDI representative.
C) Providing a fair settlement offer.
D) Taking a statement from a witness.
Answer: B) Falsely identifying themselves as a TDI representative. ( )
7. The Texas Insurance Code and the Commissioner’s Rules are found in:
A) The Texas Claim Adjuster Manual
B) The Texas Administrative Code (TAC)
C) The Underwriters Handbook
D) The Policy Provisions Guide
Answer: B) The Texas Administrative Code (TAC) ( )
8. An adjuster is permitted to accept a fee for referrals to which of the following?
A) A public insurance adjuster
B) An attorney
C) An auto glass company
D) None of the above; this is prohibited.
Answer: D) None of the above; this is prohibited. ( )
9. What is the maximum penalty for acting as an adjuster without a license in Texas?
A) $1,000 per violation
B) $5,000 per violation
C) $10,000 per violation
D) $50,000 per violation
Answer: D) $50,000 per violation ( )
10. An adjuster's license can be denied, suspended, or revoked for all of the following EXCEPT:
A) Material misrepresentation on the license application
B) Having a felony conviction involving moral turpitude
C) Failing to pass the licensing exam on the first attempt
D) Failing to comply with a court child support order
Answer: C) Failing to pass the licensing exam on the first attempt ( )
, 11. What must an adjuster do when first contacting an insured or claimant?
A) Provide their license number only upon request.
B) Identify themselves as an adjuster and provide their license number.
C) Immediately make a settlement offer.
D) Determine if the claimant has an attorney.
Answer: B) Identify themselves as an adjuster and provide their license number. ( )
12. Twisting is best defined as:
A) The fraudulent alteration of an application.
B) Misrepresenting the benefits of a policy to induce someone to lapse or forfeit an existing
policy.
C) Failing to settle a claim promptly.
D) Denying a claim without cause.
Answer: B) Misrepresenting the benefits of a policy to induce someone to lapse or forfeit an
existing policy. ( )
13. Rebating involves:
A) Giving an undisclosed discount not specified in the policy.
B) Returning a premium after a policy cancellation.
C) Reducing a claim payment for depreciation.
D) Offering a gift of insignificant value as a marketing tool.
Answer: A) Giving an undisclosed discount not specified in the policy. ( )
14. A licensee must notify TDI of any administrative action taken against them by another
state within:
A) 10 days
B) 30 days
C) 60 days
D) 6 months
Answer: B) 30 days ( )
15. The duty of good faith and fair dealing requires an insurer to:
A) Pay every claim that is submitted.
B) Treat the insured's interests with equal importance as its own.
C) Always use the insured's preferred contractor.
D) Settle claims within 72 hours.
Answer: B) Treat the insured's interests with equal importance as its own. ( )
16. What is the purpose of a "Notice of Claim" letter?
A) It is the insurer's formal denial of a claim.
