Colorado Public Adjuster Practice Examination (INSCO-PUBADJ14) LATEST QUESTIONS
AND CORRECT ANSWERS GRADE A
**Question 1:**
What is the primary role of a public adjuster in Colorado?
A) Represent the insurance company's interests
B) Represent the policyholder's interests in insurance claims
C) Sell insurance policies to consumers
D) Investigate claims for fraud on behalf of the state
**Answer:** B) Represent the policyholder's interests in insurance claims
**Explanation:** Public adjusters are licensed professionals who exclusively represent
policyholders in preparing, filing, and negotiating insurance claims.
**Question 2:**
According to Colorado law, what is the maximum fee a public adjuster can charge for
adjusting a claim?
A) 5% of the total claim settlement
B) 10% of the total claim settlement
C) 15% of the total claim settlement
D) There is no statutory maximum, but fees must be reasonable
**Answer:** B) 10% of the total claim settlement
**Explanation:** Colorado Revised Statutes § 10-2-418 limits public adjuster fees to no
more than 10% of the amount of insurance proceeds, except for supplemental claims.
**Question 3:**
,Under Colorado law, within how many days must a public adjuster provide a written
contract to the insured?
A) 24 hours
B) 3 business days
C) 5 business days
D) At the time the contract is signed
**Answer:** D) At the time the contract is signed
**Explanation:** Colorado regulations require the public adjuster to provide a complete
copy of the contract to the insured at the time the contract is signed.
**Question 4:**
Which of the following is prohibited by Colorado public adjuster regulations?
A) Advertising services in local newspapers
B) Paying referral fees to contractors for claims referrals
C) Providing free consultations to potential clients
D) Working on a contingency fee basis
**Answer:** B) Paying referral fees to contractors for claims referrals
**Explanation:** Colorado prohibits public adjusters from compensating anyone for
referring losses or prospective clients, except licensed adjusters.
**Question 5:**
What is the minimum duration of the "right to rescind" period in a Colorado public adjuster
contract?
A) 24 hours
B) 48 hours
,C) 72 hours
D) 5 business days
**Answer:** C) 72 hours
**Explanation:** Colorado law requires public adjuster contracts to include a clause
allowing the insured to rescind the contract without penalty within 72 hours of signing.
**Question 6:**
A public adjuster in Colorado must maintain a surety bond in the minimum amount of:
A) $10,000
B) $20,000
C) $50,000
D) $100,000
**Answer:** B) $20,000
**Explanation:** Colorado requires public adjusters to maintain a $20,000 surety bond as
a condition of licensure.
**Question 7:**
Which Colorado administrative agency oversees public adjuster licensing?
A) Colorado Department of Regulatory Agencies (DORA)
B) Colorado Division of Insurance
C) Colorado Department of Insurance
D) Both B and C (the same agency)
**Answer:** D) Both B and C (the same agency)
, **Explanation:** The Colorado Division of Insurance, part of the Department of Regulatory
Agencies (DORA), regulates public adjusters.
**Question 8:**
A public adjuster may handle claims arising from which type of insurance policy?
A) Property and casualty only
B) Life and health only
C) Any type of insurance policy
D) Only residential property policies
**Answer:** A) Property and casualty only
**Explanation:** Public adjusters in Colorado are generally limited to property and casualty
insurance claims, not life or health insurance.
**Question 9:**
When must a Colorado public adjuster provide their license number in advertisements?
A) Only in television advertisements
B) In all advertisements
C) Only when requested by the insured
D) Never required
**Answer:** B) In all advertisements
**Explanation:** Colorado regulations require public adjusters to include their license
number in all advertisements.
**Question 10:**
What is the primary purpose of the Valued Policy Law in Colorado?
AND CORRECT ANSWERS GRADE A
**Question 1:**
What is the primary role of a public adjuster in Colorado?
A) Represent the insurance company's interests
B) Represent the policyholder's interests in insurance claims
C) Sell insurance policies to consumers
D) Investigate claims for fraud on behalf of the state
**Answer:** B) Represent the policyholder's interests in insurance claims
**Explanation:** Public adjusters are licensed professionals who exclusively represent
policyholders in preparing, filing, and negotiating insurance claims.
**Question 2:**
According to Colorado law, what is the maximum fee a public adjuster can charge for
adjusting a claim?
A) 5% of the total claim settlement
B) 10% of the total claim settlement
C) 15% of the total claim settlement
D) There is no statutory maximum, but fees must be reasonable
**Answer:** B) 10% of the total claim settlement
**Explanation:** Colorado Revised Statutes § 10-2-418 limits public adjuster fees to no
more than 10% of the amount of insurance proceeds, except for supplemental claims.
**Question 3:**
,Under Colorado law, within how many days must a public adjuster provide a written
contract to the insured?
A) 24 hours
B) 3 business days
C) 5 business days
D) At the time the contract is signed
**Answer:** D) At the time the contract is signed
**Explanation:** Colorado regulations require the public adjuster to provide a complete
copy of the contract to the insured at the time the contract is signed.
**Question 4:**
Which of the following is prohibited by Colorado public adjuster regulations?
A) Advertising services in local newspapers
B) Paying referral fees to contractors for claims referrals
C) Providing free consultations to potential clients
D) Working on a contingency fee basis
**Answer:** B) Paying referral fees to contractors for claims referrals
**Explanation:** Colorado prohibits public adjusters from compensating anyone for
referring losses or prospective clients, except licensed adjusters.
**Question 5:**
What is the minimum duration of the "right to rescind" period in a Colorado public adjuster
contract?
A) 24 hours
B) 48 hours
,C) 72 hours
D) 5 business days
**Answer:** C) 72 hours
**Explanation:** Colorado law requires public adjuster contracts to include a clause
allowing the insured to rescind the contract without penalty within 72 hours of signing.
**Question 6:**
A public adjuster in Colorado must maintain a surety bond in the minimum amount of:
A) $10,000
B) $20,000
C) $50,000
D) $100,000
**Answer:** B) $20,000
**Explanation:** Colorado requires public adjusters to maintain a $20,000 surety bond as
a condition of licensure.
**Question 7:**
Which Colorado administrative agency oversees public adjuster licensing?
A) Colorado Department of Regulatory Agencies (DORA)
B) Colorado Division of Insurance
C) Colorado Department of Insurance
D) Both B and C (the same agency)
**Answer:** D) Both B and C (the same agency)
, **Explanation:** The Colorado Division of Insurance, part of the Department of Regulatory
Agencies (DORA), regulates public adjusters.
**Question 8:**
A public adjuster may handle claims arising from which type of insurance policy?
A) Property and casualty only
B) Life and health only
C) Any type of insurance policy
D) Only residential property policies
**Answer:** A) Property and casualty only
**Explanation:** Public adjusters in Colorado are generally limited to property and casualty
insurance claims, not life or health insurance.
**Question 9:**
When must a Colorado public adjuster provide their license number in advertisements?
A) Only in television advertisements
B) In all advertisements
C) Only when requested by the insured
D) Never required
**Answer:** B) In all advertisements
**Explanation:** Colorado regulations require public adjusters to include their license
number in all advertisements.
**Question 10:**
What is the primary purpose of the Valued Policy Law in Colorado?
