Illinois Public Adjuster Licensing
Exam Questions and Correct
Answers with Detailed Rationales |
2026/2027 Edition | Exam Prep
Study Guide PDF
1. Which person is generally required to hold an Illinois public
adjuster license?
A. A person who only repairs damaged property
B. A person who acts, advertises, solicits, or holds themselves
out as a public adjuster
C. A homeowner preparing their own insurance claim
D. An attorney providing unrelated legal services
Answer: B. A person who acts, advertises, solicits, or holds
themselves out as a public adjuster
Rationale: Illinois law requires a person to be licensed as a public
adjuster before acting, advertising, soliciting, holding themselves
out as a public adjuster, or attempting to obtain a public-adjusting
contract in Illinois. The requirement is intended to ensure that
people performing public-adjusting activities are subject to
licensing and regulatory requirements.
2. Whom does a public adjuster primarily represent when
handling an insured's property insurance claim?
A. The insurance company
B. The Illinois Department of Insurance
,C. The insured
D. The mortgage lender
Answer: C. The insured
Rationale: A public adjuster represents the insured in preparing,
presenting, and settling an insurance claim. This distinguishes a
public adjuster from a company adjuster or independent adjuster
who represents the insurer's interests.
3. Which statement correctly describes a company adjuster?
A. An adjuster hired directly by the insured
B. An employee of an insurance company who represents the
insurer's interests
C. An independent contractor who always represents the insured
D. A state employee who investigates insurance claims
Answer: B. An employee of an insurance company who
represents the insurer's interests
Rationale: Illinois' required public-adjuster disclosure
distinguishes a company adjuster as an insurance-company
employee who represents the insurance company's interest and
is paid by the insurer. A company adjuster does not charge the
insured a public-adjusting fee.
4. Which type of adjuster is hired on a contract basis by an
insurance company to represent the insurer's interests?
A. Public adjuster
B. Company adjuster
C. Independent adjuster
D. Appraiser
Answer: C. Independent adjuster
,Rationale: An independent adjuster is hired on a contract basis by
an insurance company to represent the insurance company's
interest in settling a claim. The insurer pays the independent
adjuster.
5. Which statement about hiring a public adjuster is correct
under Illinois law?
A. Every insured must hire one after a covered loss
B. Only commercial policyholders may hire one
C. The insured has the right to hire one but is not required to do so
D. Only an insurance company may hire one
Answer: C. The insured has the right to hire one but is not
required to do so
Rationale: Illinois requires the consumer disclosure to state that
an insured is not required to hire a public adjuster to meet the
insured's obligations under the policy, but has the right to do so.
6. Before an Illinois public adjuster may enter into a contract
with an insured, what must occur?
A. The insured must receive payment from the insurer
B. The adjuster must have an issued license and an approved
contract
C. The insurer must appoint the adjuster
D. The adjuster must become an employee of the insurer
Answer: B. The adjuster must have an issued license and an
approved contract
Rationale: The Illinois Department of Insurance states that a
public adjuster cannot enter into a contract with an insured until
the contract has been approved by the Department and the public
, adjuster's license has been issued. These are separate approval
processes.
7. What type of financial responsibility must an Illinois public
adjuster applicant generally provide?
A. $5,000 personal savings account
B. $10,000 cashier's check
C. $25,000 insurance policy
D. $50,000 surety bond or irrevocable letter of credit
Answer: D. $50,000 surety bond or irrevocable letter of credit
Rationale: Illinois requires evidence of financial responsibility in
the amount of $50,000, in the form of a surety bond or
certification of an irrevocable letter of credit, as part of the public
adjuster licensing process.
8. How often is the Illinois resident public adjuster license fee
of $250 payable?
A. Annually
B. Every two years
C. Every three years
D. Every five years
Answer: B. Every two years
Rationale: Illinois law establishes a $250 public adjuster license
fee for an Illinois resident, payable once every two years. The
statute also provides a different fee for nonresidents.
9. What is the Illinois public adjuster license fee for a
nonresident?
A. $150 every year
B. $250 every two years
Exam Questions and Correct
Answers with Detailed Rationales |
2026/2027 Edition | Exam Prep
Study Guide PDF
1. Which person is generally required to hold an Illinois public
adjuster license?
A. A person who only repairs damaged property
B. A person who acts, advertises, solicits, or holds themselves
out as a public adjuster
C. A homeowner preparing their own insurance claim
D. An attorney providing unrelated legal services
Answer: B. A person who acts, advertises, solicits, or holds
themselves out as a public adjuster
Rationale: Illinois law requires a person to be licensed as a public
adjuster before acting, advertising, soliciting, holding themselves
out as a public adjuster, or attempting to obtain a public-adjusting
contract in Illinois. The requirement is intended to ensure that
people performing public-adjusting activities are subject to
licensing and regulatory requirements.
2. Whom does a public adjuster primarily represent when
handling an insured's property insurance claim?
A. The insurance company
B. The Illinois Department of Insurance
,C. The insured
D. The mortgage lender
Answer: C. The insured
Rationale: A public adjuster represents the insured in preparing,
presenting, and settling an insurance claim. This distinguishes a
public adjuster from a company adjuster or independent adjuster
who represents the insurer's interests.
3. Which statement correctly describes a company adjuster?
A. An adjuster hired directly by the insured
B. An employee of an insurance company who represents the
insurer's interests
C. An independent contractor who always represents the insured
D. A state employee who investigates insurance claims
Answer: B. An employee of an insurance company who
represents the insurer's interests
Rationale: Illinois' required public-adjuster disclosure
distinguishes a company adjuster as an insurance-company
employee who represents the insurance company's interest and
is paid by the insurer. A company adjuster does not charge the
insured a public-adjusting fee.
4. Which type of adjuster is hired on a contract basis by an
insurance company to represent the insurer's interests?
A. Public adjuster
B. Company adjuster
C. Independent adjuster
D. Appraiser
Answer: C. Independent adjuster
,Rationale: An independent adjuster is hired on a contract basis by
an insurance company to represent the insurance company's
interest in settling a claim. The insurer pays the independent
adjuster.
5. Which statement about hiring a public adjuster is correct
under Illinois law?
A. Every insured must hire one after a covered loss
B. Only commercial policyholders may hire one
C. The insured has the right to hire one but is not required to do so
D. Only an insurance company may hire one
Answer: C. The insured has the right to hire one but is not
required to do so
Rationale: Illinois requires the consumer disclosure to state that
an insured is not required to hire a public adjuster to meet the
insured's obligations under the policy, but has the right to do so.
6. Before an Illinois public adjuster may enter into a contract
with an insured, what must occur?
A. The insured must receive payment from the insurer
B. The adjuster must have an issued license and an approved
contract
C. The insurer must appoint the adjuster
D. The adjuster must become an employee of the insurer
Answer: B. The adjuster must have an issued license and an
approved contract
Rationale: The Illinois Department of Insurance states that a
public adjuster cannot enter into a contract with an insured until
the contract has been approved by the Department and the public
, adjuster's license has been issued. These are separate approval
processes.
7. What type of financial responsibility must an Illinois public
adjuster applicant generally provide?
A. $5,000 personal savings account
B. $10,000 cashier's check
C. $25,000 insurance policy
D. $50,000 surety bond or irrevocable letter of credit
Answer: D. $50,000 surety bond or irrevocable letter of credit
Rationale: Illinois requires evidence of financial responsibility in
the amount of $50,000, in the form of a surety bond or
certification of an irrevocable letter of credit, as part of the public
adjuster licensing process.
8. How often is the Illinois resident public adjuster license fee
of $250 payable?
A. Annually
B. Every two years
C. Every three years
D. Every five years
Answer: B. Every two years
Rationale: Illinois law establishes a $250 public adjuster license
fee for an Illinois resident, payable once every two years. The
statute also provides a different fee for nonresidents.
9. What is the Illinois public adjuster license fee for a
nonresident?
A. $150 every year
B. $250 every two years
