❖ 17-70 – NY Independent General Adjuster |
Comprehensive Study Guide, Practice Exam, Exam
Questions & Answers, Exam Prep Test Bank, New
York Insurance Law, Property & Casualty
Insurance, Claims Investigation, Policy Coverage
Analysis, Loss Adjusting, Claims Settlement,
Ethics, Licensing Requirements, Detailed
Rationales, Insurance Exam Success
Question 1: According to New York Insurance Law Section 2108, what is a
fundamental requirement for an individual applicant for an independent
adjuster's license?
A. Must be a resident of New York State for at least one year
B. Must be at least 21 years of age at the time of issuance
C. Must be at least 18 years of age at the time of issuance
D. Must possess a bachelor's degree from an accredited institution
CORRECT ANSWER: C. Must be at least 18 years of age at the time of issuance
Rationale: Section 2108(c)(3) of the New York Insurance Law explicitly states that every
individual applicant for a license under this section and every proposed sub-licensee
must be eighteen years of age or older at the time of issuance. Age, combined with
trustworthiness and competency, are the prerequisites for licensure. The other options
are not statutory requirements for an independent adjuster license .
Question 2: An independent adjuster's license in New York is valid for a period
of:
A. One year, expiring on January 1 of each year
B. Two years, expiring on December 31 of even-numbered years
C. Three years, expiring on the licensee's birthday
D. Four years, expiring on December 31 of leap years
CORRECT ANSWER: B. Two years, expiring on December 31 of even-numbered
years
Rationale: New York independent adjuster licenses are issued for a biennial term. They
expire on December 31st of each even-numbered year. This is a standard licensing
duration established by the Department of Financial Services .
Question 3: If an adjuster's license has been revoked for cause in New York,
the former licensee is not entitled to apply for any other insurance license in
the state for a minimum period of:
A. Six months
B. One year
C. Two years
D. Three years
CORRECT ANSWER: B. One year
,Rationale: Under New York law, specifically as it relates to disciplinary actions, an
adjuster whose license has been revoked for cause is barred from applying for any other
insurance license in the state for a period of at least one year from the date of
revocation. This serves as a significant penalty for professional misconduct .
Question 4: Under the New York Insurance Fraud Prevention Act, an adjuster
who suspects fraudulent activity in a claim must report their suspicion to the
Department of Financial Services within how many business days?
A. 5 business days
B. 10 business days
C. 15 business days
D. 30 business days
CORRECT ANSWER: B. 10 business days
Rationale: The New York Insurance Fraud Prevention Act mandates that a licensed
adjuster who suspects that an insurance transaction may be fraudulent must report the
suspicion to the Department of Financial Services (DFS) promptly. The standard
regulatory expectation is notification within 10 business days of forming such a
suspicion .
Question 5: Which of the following is NOT a requirement to obtain an
independent adjuster license in New York?
A. Submit fingerprints for a background check
B. Post a $1,000 surety bond
C. Provide five certificates of character
D. Complete 40 hours of state-mandated pre-licensing education
CORRECT ANSWER: D. Complete 40 hours of state-mandated pre-licensing
education
Rationale: New York is unique in that it does not require state-mandated pre-licensing
education for independent adjusters, though such courses are highly recommended for
exam preparation. However, fingerprints, a $1,000 surety bond, and five certificates of
character from individuals who have known the applicant for at least five years are all
standard prerequisites for the license .
Question 6: An insured has a Dwelling Policy with a "Broad" form. Compared
to a "Basic" form, the "Broad" form provides coverage for all of the following
additional perils EXCEPT:
A. Falling objects
B. Weight of ice, snow, or sleet
C. Accidental discharge or overflow of water or steam
D. Earthquake
CORRECT ANSWER: D. Earthquake
,Rationale: The Dwelling Policy "Broad" form (DP-2) provides coverage for more perils
than the "Basic" form (DP-1), including falling objects, weight of ice/snow/sleet, and
accidental discharge of water. Earthquake remains an excluded peril under the standard
broad form and requires a separate endorsement to be covered .
Question 7: A claim is filed for damage to a commercial building caused by a
fire. The policy contains a "Valued Policy" law. Under this law, in the event of
a total loss, the insurer must pay:
A. The actual cash value of the property at the time of loss
B. The full policy limit stated on the declarations page
C. The replacement cost of the property
D. The amount of the loss as determined by a board of appraisers
CORRECT ANSWER: B. The full policy limit stated on the declarations page
Rationale: The "Valued Policy" law requires that, in the event of a total loss to a covered
property, the insurer must pay the full amount of the policy as stated in the declarations.
This prevents the insurer from depreciating the value of the total loss, treating the policy
as a "valued" contract that fixes the amount payable .
Question 8: When discussing the "Burden of Proof" in a property loss claim,
who has the primary responsibility to prove the value and the occurrence of
the loss?
A. The insurer's legal counsel
B. The independent adjuster
C. The insured
D. The Department of Financial Services
CORRECT ANSWER: C. The insured
Rationale: In the context of property loss claims, the insured has the burden of proof.
This means it is the insured's responsibility to provide sufficient documentation,
evidence, and proof of loss to demonstrate that a covered loss occurred and to establish
the value of the damages claimed. The adjuster's role is to verify this information .
Question 9: A liability claim arises from an incident where a contractor's
employee accidentally damages a client's property. The theory of "vicarious
liability" would most likely apply to:
A. The employee who caused the damage
B. The contractor (employer)
C. The client whose property was damaged
D. The manufacturer of the equipment used
CORRECT ANSWER: B. The contractor (employer)
Rationale: Vicarious liability is a legal doctrine where an employer is held liable for the
actions of its employees performed within the course of their employment. The
, employer is considered responsible for the acts of their employees, making the
contractor (employer) liable for the damage caused by their employee .
Question 10: The "other insurance" clause in a policy is designed to address:
A. Cancellation and non-renewal procedures
B. The insured's duties after a loss
C. How the policy interacts with other applicable policies
D. The definition of the policy territory
CORRECT ANSWER: C. How the policy interacts with other applicable policies
Rationale: The "other insurance" clause is a standard policy provision that dictates how
the policy will respond if other valid and collectible insurance policies also cover the
same loss. It establishes whether the policy is primary, excess, or contributes pro-rata to
the settlement, preventing over-insurance and ensuring fair allocation of loss among
multiple insurers .
Question 11: In the standard order of precedence for interpreting an insurance
policy, which document typically takes precedence over the others?
A. The policy form
B. The endorsements
C. The declarations page
D. The conditions section
CORRECT ANSWER: C. The declarations page
Rationale: The declarations page identifies the specific policy forms and endorsements
applicable to the contract. It also contains specific information about the insured,
property, and limits that tailor the coverage. Generally, the declarations page and
specifically attached endorsements will supersede conflicting language in the broader
policy form, setting the specific terms of the insurance contract .
Question 12: A homeowner's policy provides "Additional Living Expense"
coverage. This coverage is intended to:
A. Reimburse the insured for damage to personal belongings
B. Pay for the cost to replace the home's roof
C. Cover the increased costs of living while the home is being repaired after a covered
loss
D. Provide liability coverage for injuries that occur on the property
CORRECT ANSWER: C. Cover the increased costs of living while the home is
being repaired after a covered loss
Rationale: Additional Living Expense (ALE) coverage, also known as Coverage D in a
homeowners policy, reimburses the insured for costs incurred that are above their
normal living expenses. This applies when the insured cannot live in their home due to a
covered loss and must incur temporary housing and additional meal costs .
Comprehensive Study Guide, Practice Exam, Exam
Questions & Answers, Exam Prep Test Bank, New
York Insurance Law, Property & Casualty
Insurance, Claims Investigation, Policy Coverage
Analysis, Loss Adjusting, Claims Settlement,
Ethics, Licensing Requirements, Detailed
Rationales, Insurance Exam Success
Question 1: According to New York Insurance Law Section 2108, what is a
fundamental requirement for an individual applicant for an independent
adjuster's license?
A. Must be a resident of New York State for at least one year
B. Must be at least 21 years of age at the time of issuance
C. Must be at least 18 years of age at the time of issuance
D. Must possess a bachelor's degree from an accredited institution
CORRECT ANSWER: C. Must be at least 18 years of age at the time of issuance
Rationale: Section 2108(c)(3) of the New York Insurance Law explicitly states that every
individual applicant for a license under this section and every proposed sub-licensee
must be eighteen years of age or older at the time of issuance. Age, combined with
trustworthiness and competency, are the prerequisites for licensure. The other options
are not statutory requirements for an independent adjuster license .
Question 2: An independent adjuster's license in New York is valid for a period
of:
A. One year, expiring on January 1 of each year
B. Two years, expiring on December 31 of even-numbered years
C. Three years, expiring on the licensee's birthday
D. Four years, expiring on December 31 of leap years
CORRECT ANSWER: B. Two years, expiring on December 31 of even-numbered
years
Rationale: New York independent adjuster licenses are issued for a biennial term. They
expire on December 31st of each even-numbered year. This is a standard licensing
duration established by the Department of Financial Services .
Question 3: If an adjuster's license has been revoked for cause in New York,
the former licensee is not entitled to apply for any other insurance license in
the state for a minimum period of:
A. Six months
B. One year
C. Two years
D. Three years
CORRECT ANSWER: B. One year
,Rationale: Under New York law, specifically as it relates to disciplinary actions, an
adjuster whose license has been revoked for cause is barred from applying for any other
insurance license in the state for a period of at least one year from the date of
revocation. This serves as a significant penalty for professional misconduct .
Question 4: Under the New York Insurance Fraud Prevention Act, an adjuster
who suspects fraudulent activity in a claim must report their suspicion to the
Department of Financial Services within how many business days?
A. 5 business days
B. 10 business days
C. 15 business days
D. 30 business days
CORRECT ANSWER: B. 10 business days
Rationale: The New York Insurance Fraud Prevention Act mandates that a licensed
adjuster who suspects that an insurance transaction may be fraudulent must report the
suspicion to the Department of Financial Services (DFS) promptly. The standard
regulatory expectation is notification within 10 business days of forming such a
suspicion .
Question 5: Which of the following is NOT a requirement to obtain an
independent adjuster license in New York?
A. Submit fingerprints for a background check
B. Post a $1,000 surety bond
C. Provide five certificates of character
D. Complete 40 hours of state-mandated pre-licensing education
CORRECT ANSWER: D. Complete 40 hours of state-mandated pre-licensing
education
Rationale: New York is unique in that it does not require state-mandated pre-licensing
education for independent adjusters, though such courses are highly recommended for
exam preparation. However, fingerprints, a $1,000 surety bond, and five certificates of
character from individuals who have known the applicant for at least five years are all
standard prerequisites for the license .
Question 6: An insured has a Dwelling Policy with a "Broad" form. Compared
to a "Basic" form, the "Broad" form provides coverage for all of the following
additional perils EXCEPT:
A. Falling objects
B. Weight of ice, snow, or sleet
C. Accidental discharge or overflow of water or steam
D. Earthquake
CORRECT ANSWER: D. Earthquake
,Rationale: The Dwelling Policy "Broad" form (DP-2) provides coverage for more perils
than the "Basic" form (DP-1), including falling objects, weight of ice/snow/sleet, and
accidental discharge of water. Earthquake remains an excluded peril under the standard
broad form and requires a separate endorsement to be covered .
Question 7: A claim is filed for damage to a commercial building caused by a
fire. The policy contains a "Valued Policy" law. Under this law, in the event of
a total loss, the insurer must pay:
A. The actual cash value of the property at the time of loss
B. The full policy limit stated on the declarations page
C. The replacement cost of the property
D. The amount of the loss as determined by a board of appraisers
CORRECT ANSWER: B. The full policy limit stated on the declarations page
Rationale: The "Valued Policy" law requires that, in the event of a total loss to a covered
property, the insurer must pay the full amount of the policy as stated in the declarations.
This prevents the insurer from depreciating the value of the total loss, treating the policy
as a "valued" contract that fixes the amount payable .
Question 8: When discussing the "Burden of Proof" in a property loss claim,
who has the primary responsibility to prove the value and the occurrence of
the loss?
A. The insurer's legal counsel
B. The independent adjuster
C. The insured
D. The Department of Financial Services
CORRECT ANSWER: C. The insured
Rationale: In the context of property loss claims, the insured has the burden of proof.
This means it is the insured's responsibility to provide sufficient documentation,
evidence, and proof of loss to demonstrate that a covered loss occurred and to establish
the value of the damages claimed. The adjuster's role is to verify this information .
Question 9: A liability claim arises from an incident where a contractor's
employee accidentally damages a client's property. The theory of "vicarious
liability" would most likely apply to:
A. The employee who caused the damage
B. The contractor (employer)
C. The client whose property was damaged
D. The manufacturer of the equipment used
CORRECT ANSWER: B. The contractor (employer)
Rationale: Vicarious liability is a legal doctrine where an employer is held liable for the
actions of its employees performed within the course of their employment. The
, employer is considered responsible for the acts of their employees, making the
contractor (employer) liable for the damage caused by their employee .
Question 10: The "other insurance" clause in a policy is designed to address:
A. Cancellation and non-renewal procedures
B. The insured's duties after a loss
C. How the policy interacts with other applicable policies
D. The definition of the policy territory
CORRECT ANSWER: C. How the policy interacts with other applicable policies
Rationale: The "other insurance" clause is a standard policy provision that dictates how
the policy will respond if other valid and collectible insurance policies also cover the
same loss. It establishes whether the policy is primary, excess, or contributes pro-rata to
the settlement, preventing over-insurance and ensuring fair allocation of loss among
multiple insurers .
Question 11: In the standard order of precedence for interpreting an insurance
policy, which document typically takes precedence over the others?
A. The policy form
B. The endorsements
C. The declarations page
D. The conditions section
CORRECT ANSWER: C. The declarations page
Rationale: The declarations page identifies the specific policy forms and endorsements
applicable to the contract. It also contains specific information about the insured,
property, and limits that tailor the coverage. Generally, the declarations page and
specifically attached endorsements will supersede conflicting language in the broader
policy form, setting the specific terms of the insurance contract .
Question 12: A homeowner's policy provides "Additional Living Expense"
coverage. This coverage is intended to:
A. Reimburse the insured for damage to personal belongings
B. Pay for the cost to replace the home's roof
C. Cover the increased costs of living while the home is being repaired after a covered
loss
D. Provide liability coverage for injuries that occur on the property
CORRECT ANSWER: C. Cover the increased costs of living while the home is
being repaired after a covered loss
Rationale: Additional Living Expense (ALE) coverage, also known as Coverage D in a
homeowners policy, reimburses the insured for costs incurred that are above their
normal living expenses. This applies when the insured cannot live in their home due to a
covered loss and must incur temporary housing and additional meal costs .
