1
Texas Adjuster Exam 2026/2027 Actual Exam
| 100% Correct Answers with Detailed
Rationales | Pass Guaranteed - A+ Graded
Section 1: Texas Insurance Regulations and Laws
Q1: The Texas Department of Insurance (TDI) is responsible for all of the following EXCEPT:
A. Enforcing the Texas Insurance Code
B. Licensing insurance companies and agents
C. Setting rates for all lines of insurance in the state [CORRECT]
D. Investigating consumer complaints
Correct Answer: C
Rationale: While TDI regulates rates in some lines (like workers' comp), insurance companies
generally set their own rates based on market competition and filing requirements (file-and-use
or prior approval depending on the line). TDI does not set rates for all lines.
Q2: Under the Texas Insurance Code, which of the following acts is considered an "Unfair Claim
Settlement Practice"?
A. Acknowledging receipt of a claim within 15 days
B. Refusing to pay a claim without conducting a reasonable investigation [CORRECT]
C. Paying a claim within 30 days of reaching an agreement
D. Requesting additional information necessary to adjust the claim
Correct Answer: B
Rationale: Texas Insurance Code Chapter 541 prohibits refusing to pay a claim without
conducting a reasonable investigation. The other options are compliant claim handling behaviors.
,2
Q3: How long does an insurer have to acknowledge receipt of a claim under the Texas Prompt
Payment of Claims Act?
A. 10 business days
B. 15 business days [CORRECT]
C. 30 calendar days
D. 45 calendar days
Correct Answer: B
Rationale: Texas law requires an insurer to acknowledge receipt of a claim within 15 business
days. The acknowledgment should request necessary items and provide forms.
Q4: In Texas, the "Texas Property and Casualty Insurance Guaranty Association" is triggered
when:
A. An insured files a lawsuit against an insurer
B. An insurer becomes insolvent [CORRECT]
C. An insured cannot find coverage in the voluntary market
D. A claim exceeds the policy limits
Correct Answer: B
Rationale: The Guaranty Association acts as a safety net for policyholders and claimants when a
member insurance company becomes insolvent.
Q5: A Texas adjuster license is valid for a period of:
A. 1 year
B. 2 years [CORRECT]
C. 3 years
D. Indefinitely (as long as CE is met)
,3
Correct Answer: B
Rationale: A Texas adjuster license is issued for a two-year term. The expiration date is the last
day of the month in which the licensee was born, on even or odd years depending on the issue
date.
Q6: Which of the following individuals is exempt from holding a Texas Adjuster License?
A. A Texas resident adjusting claims for a Texas-domiciled insurer
B. An adjuster licensed in another state adjusting a single catastrophic loss in Texas [CORRECT]
C. A public insurance adjuster
D. An independent adjuster working for multiple carriers
Correct Answer: B
Rationale: Texas grants a temporary exemption for non-resident adjusters licensed in their home
state who are adjusting a specific loss or catastrophe in Texas for a short period (usually up to 90
days).
Q7: Under the Texas Prompt Payment of Claims Act, if an insurer violates the payment timelines
for a first-party claim, the insurer must pay:
A. A fine of $100 per day to TDI
B. 18% annual interest on the amount due, plus reasonable attorney fees [CORRECT]
C. Double the original claim amount
D. 10% penalty of the claim amount
Correct Answer: B
Rationale: If an insurer fails to pay a claim within the statutory timelines, they are liable for the
amount of the claim plus 18% per annum interest and reasonable attorney's fees.
Q8: An insurance company that is "domiciled" in Texas is considered a:
A. Foreign insurer
, 4
B. Alien insurer
C. Domestic insurer [CORRECT]
D. Surplus lines insurer
Correct Answer: C
Rationale: A "domestic" insurer is one formed under the laws of Texas. "Foreign" refers to other
states, and "Alien" refers to other countries.
Q9: Surplus lines insurance in Texas is designed to provide coverage for:
A. Standard risks that insurers prefer to write
B. Risks that are difficult to place in the standard market [CORRECT]
C. Federal flood insurance
D. State-mandated workers' compensation
Correct Answer: B
Rationale: Surplus lines carriers insure risks that admitted carriers will not write due to high
hazard or unique nature. These carriers are not backed by the Guaranty Association.
Q10: What is the penalty for acting as an adjuster without a license in Texas?
A. A warning for the first offense
B. A Class A misdemeanor [CORRECT]
C. A Class C misdemeanor
D. A civil fine only
Correct Answer: B
Rationale: Acting as an insurance adjuster without a valid license is a Class A misdemeanor in
Texas, carrying significant fines and potential jail time.
Texas Adjuster Exam 2026/2027 Actual Exam
| 100% Correct Answers with Detailed
Rationales | Pass Guaranteed - A+ Graded
Section 1: Texas Insurance Regulations and Laws
Q1: The Texas Department of Insurance (TDI) is responsible for all of the following EXCEPT:
A. Enforcing the Texas Insurance Code
B. Licensing insurance companies and agents
C. Setting rates for all lines of insurance in the state [CORRECT]
D. Investigating consumer complaints
Correct Answer: C
Rationale: While TDI regulates rates in some lines (like workers' comp), insurance companies
generally set their own rates based on market competition and filing requirements (file-and-use
or prior approval depending on the line). TDI does not set rates for all lines.
Q2: Under the Texas Insurance Code, which of the following acts is considered an "Unfair Claim
Settlement Practice"?
A. Acknowledging receipt of a claim within 15 days
B. Refusing to pay a claim without conducting a reasonable investigation [CORRECT]
C. Paying a claim within 30 days of reaching an agreement
D. Requesting additional information necessary to adjust the claim
Correct Answer: B
Rationale: Texas Insurance Code Chapter 541 prohibits refusing to pay a claim without
conducting a reasonable investigation. The other options are compliant claim handling behaviors.
,2
Q3: How long does an insurer have to acknowledge receipt of a claim under the Texas Prompt
Payment of Claims Act?
A. 10 business days
B. 15 business days [CORRECT]
C. 30 calendar days
D. 45 calendar days
Correct Answer: B
Rationale: Texas law requires an insurer to acknowledge receipt of a claim within 15 business
days. The acknowledgment should request necessary items and provide forms.
Q4: In Texas, the "Texas Property and Casualty Insurance Guaranty Association" is triggered
when:
A. An insured files a lawsuit against an insurer
B. An insurer becomes insolvent [CORRECT]
C. An insured cannot find coverage in the voluntary market
D. A claim exceeds the policy limits
Correct Answer: B
Rationale: The Guaranty Association acts as a safety net for policyholders and claimants when a
member insurance company becomes insolvent.
Q5: A Texas adjuster license is valid for a period of:
A. 1 year
B. 2 years [CORRECT]
C. 3 years
D. Indefinitely (as long as CE is met)
,3
Correct Answer: B
Rationale: A Texas adjuster license is issued for a two-year term. The expiration date is the last
day of the month in which the licensee was born, on even or odd years depending on the issue
date.
Q6: Which of the following individuals is exempt from holding a Texas Adjuster License?
A. A Texas resident adjusting claims for a Texas-domiciled insurer
B. An adjuster licensed in another state adjusting a single catastrophic loss in Texas [CORRECT]
C. A public insurance adjuster
D. An independent adjuster working for multiple carriers
Correct Answer: B
Rationale: Texas grants a temporary exemption for non-resident adjusters licensed in their home
state who are adjusting a specific loss or catastrophe in Texas for a short period (usually up to 90
days).
Q7: Under the Texas Prompt Payment of Claims Act, if an insurer violates the payment timelines
for a first-party claim, the insurer must pay:
A. A fine of $100 per day to TDI
B. 18% annual interest on the amount due, plus reasonable attorney fees [CORRECT]
C. Double the original claim amount
D. 10% penalty of the claim amount
Correct Answer: B
Rationale: If an insurer fails to pay a claim within the statutory timelines, they are liable for the
amount of the claim plus 18% per annum interest and reasonable attorney's fees.
Q8: An insurance company that is "domiciled" in Texas is considered a:
A. Foreign insurer
, 4
B. Alien insurer
C. Domestic insurer [CORRECT]
D. Surplus lines insurer
Correct Answer: C
Rationale: A "domestic" insurer is one formed under the laws of Texas. "Foreign" refers to other
states, and "Alien" refers to other countries.
Q9: Surplus lines insurance in Texas is designed to provide coverage for:
A. Standard risks that insurers prefer to write
B. Risks that are difficult to place in the standard market [CORRECT]
C. Federal flood insurance
D. State-mandated workers' compensation
Correct Answer: B
Rationale: Surplus lines carriers insure risks that admitted carriers will not write due to high
hazard or unique nature. These carriers are not backed by the Guaranty Association.
Q10: What is the penalty for acting as an adjuster without a license in Texas?
A. A warning for the first offense
B. A Class A misdemeanor [CORRECT]
C. A Class C misdemeanor
D. A civil fine only
Correct Answer: B
Rationale: Acting as an insurance adjuster without a valid license is a Class A misdemeanor in
Texas, carrying significant fines and potential jail time.
