Florida Property & Casualty Adjuster Exam
Practice Questions And Correct Answers
(Verified Answers) Plus Rationales
2026|2027 Q&A | Instant Download Pdf
1. What is the primary duty of an insurance adjuster in Florida?
To investigate, evaluate, and settle claims fairly and promptly.
The adjuster’s role is to represent the insurer by handling claims with
fairness and timeliness under Florida law.
2. What does insurable interest mean in property insurance?
The insured must suffer a financial loss if the property is damaged.
Without insurable interest, insurance would be a wagering contract
and void.
3. What is indemnity?
Restoring the insured to the same financial condition as before the
loss.
Indemnity prevents the insured from profiting from a loss.
,4. In Florida, what is the purpose of the Unfair Insurance Trade Practices
Act?
To protect consumers from unfair or deceptive insurance practices.
The Act prohibits misrepresentation, twisting, rebating, and unfair
claim settlement practices.
5. What is a deductible in property insurance?
The portion of a loss the insured must pay before the insurer pays.
Deductibles reduce small claims and shift part of the risk to the
insured.
6. What is subrogation?
The insurer’s right to recover from a third party responsible for the
loss.
This prevents double recovery by the insured and shifts liability to the
responsible party.
7. What is the difference between actual cash value (ACV) and
replacement cost (RC)?
ACV deducts depreciation, while RC does not.
ACV = Replacement cost – Depreciation. RC pays full cost to replace
without deduction.
8. What is the purpose of coinsurance in property insurance?
To encourage insureds to carry insurance to value.
If the insured carries less than the required percentage, they share in
the loss.
,9. In Florida, how long does an insurer have to acknowledge receipt of a
claim?
14 calendar days.
Florida Statute 627.70131 requires acknowledgment within 14 days.
10. What is the standard statute of limitations for filing a property
insurance claim lawsuit in Florida?
Five years.
Florida law sets a five-year limit for contract-related lawsuits,
including insurance claims.
11. What is liability insurance designed to cover?
Legal responsibility for injury or damage to others.
Liability insurance protects against third-party claims.
12. What does the term “first-party claim” mean?
A claim made by the insured against their own policy.
Example: A homeowner filing a claim for storm damage.
13. What does the term “third-party claim” mean?
A claim made by someone other than the insured against the
insured’s policy.
Example: A driver sues another driver’s liability insurance.
14. What does the appraisal clause in a property policy allow?
A method to resolve disputes over the amount of loss.
Both sides select appraisers and an umpire to determine the value.
, 15. What is proximate cause?
The dominant cause that sets other events in motion resulting in a
loss.
Courts use proximate cause to determine coverage when multiple
causes exist.
16. What is salvage in insurance?
The remaining value of damaged property.
Insurers may recover part of a claim payout by selling salvage.
17. What does a reservation of rights letter do?
Notifies the insured the insurer may deny coverage after
investigation.
It preserves the insurer’s defenses while investigating a claim.
18. What is moral hazard?
Dishonesty or character traits that increase loss probability.
Example: Insurance fraud by exaggerating a claim.
19. What is morale hazard?
Carelessness or indifference to loss due to insurance coverage.
Example: Failing to lock doors because insurance will cover theft.
20. What is physical hazard?
A tangible condition increasing the chance of loss.
Example: A broken step creating a risk of injury.
Practice Questions And Correct Answers
(Verified Answers) Plus Rationales
2026|2027 Q&A | Instant Download Pdf
1. What is the primary duty of an insurance adjuster in Florida?
To investigate, evaluate, and settle claims fairly and promptly.
The adjuster’s role is to represent the insurer by handling claims with
fairness and timeliness under Florida law.
2. What does insurable interest mean in property insurance?
The insured must suffer a financial loss if the property is damaged.
Without insurable interest, insurance would be a wagering contract
and void.
3. What is indemnity?
Restoring the insured to the same financial condition as before the
loss.
Indemnity prevents the insured from profiting from a loss.
,4. In Florida, what is the purpose of the Unfair Insurance Trade Practices
Act?
To protect consumers from unfair or deceptive insurance practices.
The Act prohibits misrepresentation, twisting, rebating, and unfair
claim settlement practices.
5. What is a deductible in property insurance?
The portion of a loss the insured must pay before the insurer pays.
Deductibles reduce small claims and shift part of the risk to the
insured.
6. What is subrogation?
The insurer’s right to recover from a third party responsible for the
loss.
This prevents double recovery by the insured and shifts liability to the
responsible party.
7. What is the difference between actual cash value (ACV) and
replacement cost (RC)?
ACV deducts depreciation, while RC does not.
ACV = Replacement cost – Depreciation. RC pays full cost to replace
without deduction.
8. What is the purpose of coinsurance in property insurance?
To encourage insureds to carry insurance to value.
If the insured carries less than the required percentage, they share in
the loss.
,9. In Florida, how long does an insurer have to acknowledge receipt of a
claim?
14 calendar days.
Florida Statute 627.70131 requires acknowledgment within 14 days.
10. What is the standard statute of limitations for filing a property
insurance claim lawsuit in Florida?
Five years.
Florida law sets a five-year limit for contract-related lawsuits,
including insurance claims.
11. What is liability insurance designed to cover?
Legal responsibility for injury or damage to others.
Liability insurance protects against third-party claims.
12. What does the term “first-party claim” mean?
A claim made by the insured against their own policy.
Example: A homeowner filing a claim for storm damage.
13. What does the term “third-party claim” mean?
A claim made by someone other than the insured against the
insured’s policy.
Example: A driver sues another driver’s liability insurance.
14. What does the appraisal clause in a property policy allow?
A method to resolve disputes over the amount of loss.
Both sides select appraisers and an umpire to determine the value.
, 15. What is proximate cause?
The dominant cause that sets other events in motion resulting in a
loss.
Courts use proximate cause to determine coverage when multiple
causes exist.
16. What is salvage in insurance?
The remaining value of damaged property.
Insurers may recover part of a claim payout by selling salvage.
17. What does a reservation of rights letter do?
Notifies the insured the insurer may deny coverage after
investigation.
It preserves the insurer’s defenses while investigating a claim.
18. What is moral hazard?
Dishonesty or character traits that increase loss probability.
Example: Insurance fraud by exaggerating a claim.
19. What is morale hazard?
Carelessness or indifference to loss due to insurance coverage.
Example: Failing to lock doors because insurance will cover theft.
20. What is physical hazard?
A tangible condition increasing the chance of loss.
Example: A broken step creating a risk of injury.
