Fall Semester 2026–2027 Florida 3-20 Public Adjuster License Updated 2026 |
190+ Questions and Answers | Florida 3-20 Public Adjuster Licensing Exam Prep,
Comprehensive Study Guide, Practice Exam, Test Bank, Property Insurance,
Insurance Claims, Claims Investigation, Policy Interpretation, Property Damage
Assessment, Florida Insurance Laws, Ethics, Settlement Negotiations, Adjusting
Practices, Detailed Rationales and Complete Revision Material
Question 1: According to Florida Statute 626.854, what is the statutory
definition of a "public adjuster"?
A. An individual who investigates and settles claims on behalf of an insurance company.
B. An individual employed by the state to mediate disputes between insurers and
policyholders.
C. An individual who handles claims for a self-insured entity.
D. An individual who is retained by an insured to investigate, negotiate, and settle a
claim on their behalf.
CORRECT ANSWER: D. An individual who is retained by an insured to
investigate, negotiate, and settle a claim on their behalf.
Rationale: : Florida Statute 626.854 explicitly defines a public adjuster as a person who
is retained by an insured to act on their behalf in the negotiation and settlement of a
claim. Options A and C describe adjusters working for the insurer or self-insured
entities, while option B describes a mediator.
Question 2: What is the minimum age requirement to apply for a Florida 3-20
Public Adjuster license?
A. 18 years old
B. 21 years old
C. 25 years old
D. No age requirement
CORRECT ANSWER: A. 18 years old
Rationale: : Florida law, specifically regarding adjuster qualifications, mandates that an
applicant for a public adjuster's license must be a natural person at least 18 years of age.
This is a foundational requirement for licensing eligibility .
Question 3: What is the required surety bond amount for a Florida-licensed
resident public adjuster?
A. $10,000
B. $25,000
C. $50,000
D. $100,000
CORRECT ANSWER: C. $50,000
Rationale: : Florida law requires all public adjusters to file a surety bond in the amount
of $50,000. This bond is conditioned for the faithful performance of their duties and is in
favor of the Department of Financial Services .
,Question 4: A public adjuster is prohibited from receiving payment or anything
of value as a result of which type of practice?
A. An arm's length transaction.
B. A fair and honest negotiation.
C. An unfair or deceptive practice.
D. A transparent business agreement.
CORRECT ANSWER: C. An unfair or deceptive practice.
Rationale: : Florida Statutes Section 626.8698 outlines disciplinary guidelines for public
adjusters. It explicitly states that a licensee may be disciplined for receiving payment or
anything of value as a result of an unfair or deceptive practice .
Question 5: In Florida, for how long must a nonresident public adjuster retain
their records after the completion of an adjustment?
A. 1 year
B. 2 years
C. 3 years
D. 5 years
CORRECT ANSWER: C. 3 years
Rationale: : Florida law mandates that nonresident public adjusters must retain their
usual and customary records pertaining to transactions under their license for at least 3
years after the completion of the adjustment. These records must be made available to
the Department upon request .
Question 6: Which of the following is a valid ground for disciplinary action
against a public adjuster in Florida?
A. Failing to maintain a professional website.
B. Violating an ethical rule of the Department.
C. Refusing to accept a case with a low settlement value.
D. Not providing a discount for claimants with multiple losses.
CORRECT ANSWER: B. Violating an ethical rule of the Department.
Rationale: : Florida Statute 626.8698 lists violations that can lead to the denial,
suspension, or revocation of a public adjuster's license. A violation of any ethical rule
promulgated by the Department constitutes grounds for such disciplinary action .
Question 7: What type of claim is filed by a policyholder against their own
insurance policy?
A. Third-party claim
B. Liability claim
C. First-party claim
D. Bad faith claim
,CORRECT ANSWER: C. First-party claim
Rationale: : A first-party claim is a claim filed by the insured (the first party) against
their own insurance company (the second party). This is a fundamental concept in
insurance claims handling that is tested on the 3-20 exam .
Question 8: The term "proximate cause" in insurance refers to what concept?
A. The first cause of a loss that is not excluded by the policy.
B. The financial value of a loss.
C. The location where a loss occurred.
D. An unbroken chain of events between an occurrence and a loss.
CORRECT ANSWER: A. The first cause of a loss that is not excluded by the
policy.
Rationale: : Proximate cause is the dominant cause of a loss or the first event in an
unbroken chain of events that leads to damage. In insurance, the determination of
coverage often hinges on whether the proximate cause of the loss is a covered peril .
Question 9: What is the maximum administrative penalty that can be imposed
for each act of violation by a public adjuster in Florida?
A. $1,000
B. $5,000
C. $10,000
D. $25,000
CORRECT ANSWER: B. $5,000
Rationale: : Florida Statute 626.8698 authorizes the Department to administer a fine not
to exceed $5,000 per act for various statutory violations committed by a public adjuster .
Question 10: Florida Statutes define a "hazard" as an instance, behavior, or
environment that does which of the following?
A. Provides coverage for a loss.
B. Increases the likelihood of a loss.
C. Excludes coverage for a specific peril.
D. Determines the value of a claim.
CORRECT ANSWER: B. Increases the likelihood of a loss.
Rationale: : In the context of insurance, a hazard is a condition or situation that creates
or increases the chance of a loss occurring. This is a core concept distinct from a peril,
which is the actual cause of the loss .
Question 11: What is the purpose of a "binder" in insurance?
A. To permanently modify an existing policy.
B. To provide temporary insurance coverage until a policy is written.
, C. To guarantee the payment of a loan.
D. To serve as the official policy document.
CORRECT ANSWER: B. To provide temporary insurance coverage until a policy
is written.
Rationale: : A binder is a temporary or preliminary agreement that provides immediate
insurance coverage until the formal policy can be issued. It acts as a place-holder for the
insurance contract .
Question 12: Under Florida law, an insurer is considered "foreign" if it is:
A. Domiciled outside of the United States.
B. Domiciled in a state other than Florida.
C. Domiciled in Florida but operates in other states.
D. A state-operated insurance program.
CORRECT ANSWER: B. Domiciled in a state other than Florida.
Rationale: : An insurance company is classified by its state of domicile. A "foreign"
insurer is one that is incorporated in another state or country, but is licensed to do
business in Florida. An "alien" insurer is domiciled outside of the United States .
Question 13: A "civil remedies notice" is intended to meet a portion of legal
requirements set forth in Section 624.155, Florida Statutes, and must be filed
how many days prior to bringing an action against an insurer?
A. 30 days
B. 45 days
C. 60 days
D. 90 days
CORRECT ANSWER: C. 60 days
Rationale: : Section 624.155, Florida Statutes, which deals with civil remedies, requires
that a party file a notice with the insurer and the Department of Financial Services at
least 60 days before initiating a lawsuit against the insurer. This is a key pre-suit
requirement .
Question 14: What is the "Liberalization Clause" in an insurance policy?
A. A clause that allows the insurer to cancel the policy at any time.
B. A clause that requires the insured to pay a higher premium.
C. A clause that automatically applies broader coverage to the insured's policy without
an additional premium.
D. A clause that requires the insured to submit to an examination under oath.
CORRECT ANSWER: C. A clause that automatically applies broader coverage
to the insured's policy without an additional premium.
190+ Questions and Answers | Florida 3-20 Public Adjuster Licensing Exam Prep,
Comprehensive Study Guide, Practice Exam, Test Bank, Property Insurance,
Insurance Claims, Claims Investigation, Policy Interpretation, Property Damage
Assessment, Florida Insurance Laws, Ethics, Settlement Negotiations, Adjusting
Practices, Detailed Rationales and Complete Revision Material
Question 1: According to Florida Statute 626.854, what is the statutory
definition of a "public adjuster"?
A. An individual who investigates and settles claims on behalf of an insurance company.
B. An individual employed by the state to mediate disputes between insurers and
policyholders.
C. An individual who handles claims for a self-insured entity.
D. An individual who is retained by an insured to investigate, negotiate, and settle a
claim on their behalf.
CORRECT ANSWER: D. An individual who is retained by an insured to
investigate, negotiate, and settle a claim on their behalf.
Rationale: : Florida Statute 626.854 explicitly defines a public adjuster as a person who
is retained by an insured to act on their behalf in the negotiation and settlement of a
claim. Options A and C describe adjusters working for the insurer or self-insured
entities, while option B describes a mediator.
Question 2: What is the minimum age requirement to apply for a Florida 3-20
Public Adjuster license?
A. 18 years old
B. 21 years old
C. 25 years old
D. No age requirement
CORRECT ANSWER: A. 18 years old
Rationale: : Florida law, specifically regarding adjuster qualifications, mandates that an
applicant for a public adjuster's license must be a natural person at least 18 years of age.
This is a foundational requirement for licensing eligibility .
Question 3: What is the required surety bond amount for a Florida-licensed
resident public adjuster?
A. $10,000
B. $25,000
C. $50,000
D. $100,000
CORRECT ANSWER: C. $50,000
Rationale: : Florida law requires all public adjusters to file a surety bond in the amount
of $50,000. This bond is conditioned for the faithful performance of their duties and is in
favor of the Department of Financial Services .
,Question 4: A public adjuster is prohibited from receiving payment or anything
of value as a result of which type of practice?
A. An arm's length transaction.
B. A fair and honest negotiation.
C. An unfair or deceptive practice.
D. A transparent business agreement.
CORRECT ANSWER: C. An unfair or deceptive practice.
Rationale: : Florida Statutes Section 626.8698 outlines disciplinary guidelines for public
adjusters. It explicitly states that a licensee may be disciplined for receiving payment or
anything of value as a result of an unfair or deceptive practice .
Question 5: In Florida, for how long must a nonresident public adjuster retain
their records after the completion of an adjustment?
A. 1 year
B. 2 years
C. 3 years
D. 5 years
CORRECT ANSWER: C. 3 years
Rationale: : Florida law mandates that nonresident public adjusters must retain their
usual and customary records pertaining to transactions under their license for at least 3
years after the completion of the adjustment. These records must be made available to
the Department upon request .
Question 6: Which of the following is a valid ground for disciplinary action
against a public adjuster in Florida?
A. Failing to maintain a professional website.
B. Violating an ethical rule of the Department.
C. Refusing to accept a case with a low settlement value.
D. Not providing a discount for claimants with multiple losses.
CORRECT ANSWER: B. Violating an ethical rule of the Department.
Rationale: : Florida Statute 626.8698 lists violations that can lead to the denial,
suspension, or revocation of a public adjuster's license. A violation of any ethical rule
promulgated by the Department constitutes grounds for such disciplinary action .
Question 7: What type of claim is filed by a policyholder against their own
insurance policy?
A. Third-party claim
B. Liability claim
C. First-party claim
D. Bad faith claim
,CORRECT ANSWER: C. First-party claim
Rationale: : A first-party claim is a claim filed by the insured (the first party) against
their own insurance company (the second party). This is a fundamental concept in
insurance claims handling that is tested on the 3-20 exam .
Question 8: The term "proximate cause" in insurance refers to what concept?
A. The first cause of a loss that is not excluded by the policy.
B. The financial value of a loss.
C. The location where a loss occurred.
D. An unbroken chain of events between an occurrence and a loss.
CORRECT ANSWER: A. The first cause of a loss that is not excluded by the
policy.
Rationale: : Proximate cause is the dominant cause of a loss or the first event in an
unbroken chain of events that leads to damage. In insurance, the determination of
coverage often hinges on whether the proximate cause of the loss is a covered peril .
Question 9: What is the maximum administrative penalty that can be imposed
for each act of violation by a public adjuster in Florida?
A. $1,000
B. $5,000
C. $10,000
D. $25,000
CORRECT ANSWER: B. $5,000
Rationale: : Florida Statute 626.8698 authorizes the Department to administer a fine not
to exceed $5,000 per act for various statutory violations committed by a public adjuster .
Question 10: Florida Statutes define a "hazard" as an instance, behavior, or
environment that does which of the following?
A. Provides coverage for a loss.
B. Increases the likelihood of a loss.
C. Excludes coverage for a specific peril.
D. Determines the value of a claim.
CORRECT ANSWER: B. Increases the likelihood of a loss.
Rationale: : In the context of insurance, a hazard is a condition or situation that creates
or increases the chance of a loss occurring. This is a core concept distinct from a peril,
which is the actual cause of the loss .
Question 11: What is the purpose of a "binder" in insurance?
A. To permanently modify an existing policy.
B. To provide temporary insurance coverage until a policy is written.
, C. To guarantee the payment of a loan.
D. To serve as the official policy document.
CORRECT ANSWER: B. To provide temporary insurance coverage until a policy
is written.
Rationale: : A binder is a temporary or preliminary agreement that provides immediate
insurance coverage until the formal policy can be issued. It acts as a place-holder for the
insurance contract .
Question 12: Under Florida law, an insurer is considered "foreign" if it is:
A. Domiciled outside of the United States.
B. Domiciled in a state other than Florida.
C. Domiciled in Florida but operates in other states.
D. A state-operated insurance program.
CORRECT ANSWER: B. Domiciled in a state other than Florida.
Rationale: : An insurance company is classified by its state of domicile. A "foreign"
insurer is one that is incorporated in another state or country, but is licensed to do
business in Florida. An "alien" insurer is domiciled outside of the United States .
Question 13: A "civil remedies notice" is intended to meet a portion of legal
requirements set forth in Section 624.155, Florida Statutes, and must be filed
how many days prior to bringing an action against an insurer?
A. 30 days
B. 45 days
C. 60 days
D. 90 days
CORRECT ANSWER: C. 60 days
Rationale: : Section 624.155, Florida Statutes, which deals with civil remedies, requires
that a party file a notice with the insurer and the Department of Financial Services at
least 60 days before initiating a lawsuit against the insurer. This is a key pre-suit
requirement .
Question 14: What is the "Liberalization Clause" in an insurance policy?
A. A clause that allows the insurer to cancel the policy at any time.
B. A clause that requires the insured to pay a higher premium.
C. A clause that automatically applies broader coverage to the insured's policy without
an additional premium.
D. A clause that requires the insured to submit to an examination under oath.
CORRECT ANSWER: C. A clause that automatically applies broader coverage
to the insured's policy without an additional premium.
