CLAIMS ADJUSTER EXAM STUDY GUIDE | QUESTIONS &
ANSWERS | NEW 2026/2027 UPDATE | GRADED A+| 100% CORRECT
(VERIFIED SOLUTIONS)
What does a misrepresentation involve that could void a policy? -
ANSWER
information that may change the insurer's interest in issuing the policy if known at the time of the
application
All of the following are Unfair Claims Settlement Practices EXCEPT
1. misrepresentation of policy provisions.
2. failure to acknowledge pertinent communications.
3. failure to respond to a first notice of loss within 24 hours.
4. denial of claim without a reasonable investigation. -
ANSWER
failure to respond to a first notice of loss within 24 hours.
Which of the following characteristics of an insurance contract expresses the principle that the
policyholder is returned to the approximate financial condition as before the loss? -
ANSWER
Indemnity
Compensatory damages are awarded -
ANSWER
For actual loss suffered
An insured with split liability limits of $400/500/400 is at fault in an automobile accident and the
other vehicle sustains $15000 in property damages, as well as two passengers have bodily injury and
are claiming $81500 each. What is the MOST insurance will pay to each occupant? -
ANSWER
$400,000
Who does a public adjuster represent?
,1. an adjustment bureau
2. the government
3. the insured
4. the insurer -
ANSWER
the insured
Which of the following is a duty of the insured after a loss?
1. assigning risk to future loss
2. investigating cause of loss
3. minimizing further loss
4. appraising value of loss -
ANSWER
minimizing further loss
What is the insurance adjuster's first step in an investigation?
1. determine if a loss occurred
2. determine the amount covered
3. determine if the type of loss is covered in the contract
4. determine if the loss occurred during the coverage period -
ANSWER
determine if a loss occurred
What allows insurance agents to issue payment on behalf of their company? -
ANSWER
draft authority
What is typically the first option available for the insured who disagrees with a loss settlement
amount?
1. appeal
2. lawsuit
3. arbitration
,4. grievance claim -
ANSWER
arbitration
Which party is required to provide proof of loss to establish entitlement?
1. the insurer
2. the insured
3. selling agent
4. law enforcement -
ANSWER
the insured
Jane takes her vehicle to the local garage to have new brakes installed. After completing the job, the
mechanic takes the car out for a test drive. The mechanic runs a red light and hits another vehicle.
The damage to Jane's car would be covered PRIMARILY by -
ANSWER
the repair shop's Garagekeepers Liability Policy.
During the first 60 days an automobile policy is in force, when may an insurer cancel the policy? -
ANSWER
by a statement of the specific reason
Which of the following is how defense costs are paid in relation to the limit of insurance under the
personal auto policy for bodily injury and property damage part A-liability coverage? -
ANSWER
in excess of the limit
All of the following are TRUE regarding a nonowned auto EXCEPT -
ANSWER
bodily Injury to an insured's nonresident family member or relative.
, The insured has a commercial auto policy with a drive other car broadened coverage liability for
named individuals (DOC) endorsement. In which of the following would the named individual be
covered? -
ANSWER
driving neighbor's auto
All of the following are TRUE regarding torts EXCEPT
1. a tort is always unintentional.
2. another term for tort is negligence.
3. torts involve private relationships.
4. a tort is a civil wrong that violates the rights of another. -
ANSWER
a tort is always unintentional.
Which of the following is considered temporary substitute auto for physical damage?
1. a covered auto
2. a nonowned auto
3. an undefined risk
4. a noninsured auto -
ANSWER
a nonowned auto
All of the following are common exclusions in a liability policy EXCEPT -
ANSWER
damage caused by acts of civil disobedience and riots.
An annuitant is paying into an annuity. The annuity contract is in the -
ANSWER
annuitization period.
The insured causes an accident in which three persons are injured. One person claims $50,000, the
second claims $100,000, and the third claims $250,000. The insured has a combined single limit of
$250,000 liability on his automobile policy. What is the sum total the policy will pay? -
ANSWERS | NEW 2026/2027 UPDATE | GRADED A+| 100% CORRECT
(VERIFIED SOLUTIONS)
What does a misrepresentation involve that could void a policy? -
ANSWER
information that may change the insurer's interest in issuing the policy if known at the time of the
application
All of the following are Unfair Claims Settlement Practices EXCEPT
1. misrepresentation of policy provisions.
2. failure to acknowledge pertinent communications.
3. failure to respond to a first notice of loss within 24 hours.
4. denial of claim without a reasonable investigation. -
ANSWER
failure to respond to a first notice of loss within 24 hours.
Which of the following characteristics of an insurance contract expresses the principle that the
policyholder is returned to the approximate financial condition as before the loss? -
ANSWER
Indemnity
Compensatory damages are awarded -
ANSWER
For actual loss suffered
An insured with split liability limits of $400/500/400 is at fault in an automobile accident and the
other vehicle sustains $15000 in property damages, as well as two passengers have bodily injury and
are claiming $81500 each. What is the MOST insurance will pay to each occupant? -
ANSWER
$400,000
Who does a public adjuster represent?
,1. an adjustment bureau
2. the government
3. the insured
4. the insurer -
ANSWER
the insured
Which of the following is a duty of the insured after a loss?
1. assigning risk to future loss
2. investigating cause of loss
3. minimizing further loss
4. appraising value of loss -
ANSWER
minimizing further loss
What is the insurance adjuster's first step in an investigation?
1. determine if a loss occurred
2. determine the amount covered
3. determine if the type of loss is covered in the contract
4. determine if the loss occurred during the coverage period -
ANSWER
determine if a loss occurred
What allows insurance agents to issue payment on behalf of their company? -
ANSWER
draft authority
What is typically the first option available for the insured who disagrees with a loss settlement
amount?
1. appeal
2. lawsuit
3. arbitration
,4. grievance claim -
ANSWER
arbitration
Which party is required to provide proof of loss to establish entitlement?
1. the insurer
2. the insured
3. selling agent
4. law enforcement -
ANSWER
the insured
Jane takes her vehicle to the local garage to have new brakes installed. After completing the job, the
mechanic takes the car out for a test drive. The mechanic runs a red light and hits another vehicle.
The damage to Jane's car would be covered PRIMARILY by -
ANSWER
the repair shop's Garagekeepers Liability Policy.
During the first 60 days an automobile policy is in force, when may an insurer cancel the policy? -
ANSWER
by a statement of the specific reason
Which of the following is how defense costs are paid in relation to the limit of insurance under the
personal auto policy for bodily injury and property damage part A-liability coverage? -
ANSWER
in excess of the limit
All of the following are TRUE regarding a nonowned auto EXCEPT -
ANSWER
bodily Injury to an insured's nonresident family member or relative.
, The insured has a commercial auto policy with a drive other car broadened coverage liability for
named individuals (DOC) endorsement. In which of the following would the named individual be
covered? -
ANSWER
driving neighbor's auto
All of the following are TRUE regarding torts EXCEPT
1. a tort is always unintentional.
2. another term for tort is negligence.
3. torts involve private relationships.
4. a tort is a civil wrong that violates the rights of another. -
ANSWER
a tort is always unintentional.
Which of the following is considered temporary substitute auto for physical damage?
1. a covered auto
2. a nonowned auto
3. an undefined risk
4. a noninsured auto -
ANSWER
a nonowned auto
All of the following are common exclusions in a liability policy EXCEPT -
ANSWER
damage caused by acts of civil disobedience and riots.
An annuitant is paying into an annuity. The annuity contract is in the -
ANSWER
annuitization period.
The insured causes an accident in which three persons are injured. One person claims $50,000, the
second claims $100,000, and the third claims $250,000. The insured has a combined single limit of
$250,000 liability on his automobile policy. What is the sum total the policy will pay? -
