Texas Insurance Adjuster Licensing
Exam With Actual Questions & Verified
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1. An insurance adjuster must report which of the following types of
claims?
A. Only claims over $5,000
B. All claims regardless of amount
C. Only claims involving property damage
D. Only claims involving bodily injury
B. All claims regardless of amount
Rationale: Adjusters are required to report all claims they handle to maintain
accurate records and ensure compliance with Texas Department of Insurance
regulations.
2. What is the main purpose of an insurance policy?
A. To provide investment opportunities
B. To transfer risk from the insured to the insurer
C. To increase the insured's liability
D. To guarantee profits for the insurance company
B. To transfer risk from the insured to the insurer
Rationale: Insurance policies exist to shift financial risk from an individual or
business to the insurance company in exchange for a premium.
, 3. Which of the following is considered an insurable interest?
A. A neighbor’s car
B. Your own home
C. A public park
D. A company you have never worked for
B. Your own home
Rationale: An insurable interest exists when the insured would suffer a
financial loss or certain other types of loss if the insured property or life were
harmed.
4. What is the purpose of a deductible in an insurance policy?
A. To increase premiums
B. To reduce the insurer’s risk and prevent small claims
C. To guarantee a payout
D. To limit liability to third parties
B. To reduce the insurer’s risk and prevent small claims
Rationale: Deductibles require the insured to pay a portion of a loss, which
discourages minor claims and reduces overall cost to the insurer.
5. Which type of policy provides coverage for both property and liability?
A. Homeowners policy
B. Workers’ compensation
C. Life insurance
D. Health insurance
A. Homeowners policy
Rationale: Homeowners policies typically combine coverage for property
damage and personal liability protection.
6. An adjuster is assigned a claim that appears fraudulent. What should the
adjuster do first?
A. Deny the claim immediately
B. Notify the insurer and document observations
C. Pay the claim to avoid conflict
D. Contact the policyholder’s attorney
, B. Notify the insurer and document observations
Rationale: Adjusters must investigate suspected fraud carefully, documenting
evidence and informing their company before taking action.
7. Which term describes the amount of money the insurer is liable to pay
for a covered loss?
A. Premium
B. Limit of liability
C. Deductible
D. Exclusion
B. Limit of liability
Rationale: The limit of liability is the maximum amount an insurer will pay for
a covered loss under a policy.
8. What is subrogation?
A. Paying a policyholder more than the loss value
B. The insurer’s right to recover from a third party after paying a claim
C. Denying a fraudulent claim
D. Charging extra premiums for high-risk clients
B. The insurer’s right to recover from a third party after paying a claim
Rationale: Subrogation allows insurers to seek reimbursement from a
responsible third party to prevent the insured from collecting twice.
9. Which of the following is a duty of an adjuster after a claim is filed?
A. Only collect premiums
B. Investigate, evaluate, and negotiate claims
C. Write new policies
D. Set insurance rates
B. Investigate, evaluate, and negotiate claims
Rationale: Adjusters must assess claims to determine liability, damage, and
the appropriate settlement amount.
10.What is a “binder” in insurance?
A. A document summarizing the claim
B. Temporary coverage provided before the policy is issued
Exam With Actual Questions & Verified
Answers,Plus Rationales/Expert
Verified For Guaranteed Pass Graded
A+/2026 /Latest Update/Instant
Download Pdf
1. An insurance adjuster must report which of the following types of
claims?
A. Only claims over $5,000
B. All claims regardless of amount
C. Only claims involving property damage
D. Only claims involving bodily injury
B. All claims regardless of amount
Rationale: Adjusters are required to report all claims they handle to maintain
accurate records and ensure compliance with Texas Department of Insurance
regulations.
2. What is the main purpose of an insurance policy?
A. To provide investment opportunities
B. To transfer risk from the insured to the insurer
C. To increase the insured's liability
D. To guarantee profits for the insurance company
B. To transfer risk from the insured to the insurer
Rationale: Insurance policies exist to shift financial risk from an individual or
business to the insurance company in exchange for a premium.
, 3. Which of the following is considered an insurable interest?
A. A neighbor’s car
B. Your own home
C. A public park
D. A company you have never worked for
B. Your own home
Rationale: An insurable interest exists when the insured would suffer a
financial loss or certain other types of loss if the insured property or life were
harmed.
4. What is the purpose of a deductible in an insurance policy?
A. To increase premiums
B. To reduce the insurer’s risk and prevent small claims
C. To guarantee a payout
D. To limit liability to third parties
B. To reduce the insurer’s risk and prevent small claims
Rationale: Deductibles require the insured to pay a portion of a loss, which
discourages minor claims and reduces overall cost to the insurer.
5. Which type of policy provides coverage for both property and liability?
A. Homeowners policy
B. Workers’ compensation
C. Life insurance
D. Health insurance
A. Homeowners policy
Rationale: Homeowners policies typically combine coverage for property
damage and personal liability protection.
6. An adjuster is assigned a claim that appears fraudulent. What should the
adjuster do first?
A. Deny the claim immediately
B. Notify the insurer and document observations
C. Pay the claim to avoid conflict
D. Contact the policyholder’s attorney
, B. Notify the insurer and document observations
Rationale: Adjusters must investigate suspected fraud carefully, documenting
evidence and informing their company before taking action.
7. Which term describes the amount of money the insurer is liable to pay
for a covered loss?
A. Premium
B. Limit of liability
C. Deductible
D. Exclusion
B. Limit of liability
Rationale: The limit of liability is the maximum amount an insurer will pay for
a covered loss under a policy.
8. What is subrogation?
A. Paying a policyholder more than the loss value
B. The insurer’s right to recover from a third party after paying a claim
C. Denying a fraudulent claim
D. Charging extra premiums for high-risk clients
B. The insurer’s right to recover from a third party after paying a claim
Rationale: Subrogation allows insurers to seek reimbursement from a
responsible third party to prevent the insured from collecting twice.
9. Which of the following is a duty of an adjuster after a claim is filed?
A. Only collect premiums
B. Investigate, evaluate, and negotiate claims
C. Write new policies
D. Set insurance rates
B. Investigate, evaluate, and negotiate claims
Rationale: Adjusters must assess claims to determine liability, damage, and
the appropriate settlement amount.
10.What is a “binder” in insurance?
A. A document summarizing the claim
B. Temporary coverage provided before the policy is issued
