FLORIDA CERTIFIED ADJUSTER PRACTICE
EXAM WITH ANSWERS
Jane has $150,000 homeowners policy with a 3% percentage deductible. One night, In
oven fire destroys her kitchen, causing $50,000 in damage. How much of the damage
falls under Janes responsibility? - answer-$4,500
Xavier owns a small insurance company. Recently the company want to bid to ensure a
new housing development in Omaha, Nebraska. His company can handle any claims
that arise, but if a series of tornadoes were to tear through the area and destroy the
entire development, Xavier's company would suffer financially. Which type of insure
could help Xavier's company protect itself the most from this potential loss? - answer-A
re-insurer
Which of the following situations does NOT involve an instance of "pure risk?" - answer-
Loss of money invested in the stock market
Which of the following is an insurable risk? - answer-A football stadium
A lightning strike causes one of those storage buildings on John's farm to burn to the
ground, added by the fuel tanks he kept in the building. John knows he wasn't
supposed to store any fuel in the building, so he kept that piece of information to
himself when he files a claim. John's ensure made and I his claim based on his: -
answer-Concealment
Chain shed burned to the ground during a tornado, when the Highwinds break a wall of
the shed, knocking over a lantern inside. What is the proximate cause of the loss? -
answer-Wind
Kevin plays in a brass band using two rare antique Alexander tubas. Since they are no
longer produced, the value of the tubas is difficult to determine. Which type of policy
would best indemnify Kevin in this event that his two boys were damaged, lost, or
stolen? - answer-Agreed value policy
Which settlement option is most often use when the claimant misses work because of a
bodily injury, but a settlement has not been reached? - answer-Advance payment
settlement
Adjuster Andy is trying to determine a final settlement amount for Stacy's claim. Stacy's
house was destroyed in a house fire and it will cost $185,000 to rebuild it. Stacy's
homeowner policy has a limit of $178,000 and $1800 deductible. Typically, how much
would adjuster Andy calculate Stacy's final settlement amount to be - answer-$178,000
,Stephanie is in the process of addressing George's auto claim. Currently she is
interviewing Shana, who witnessed George's accident and stopped to help. In what
stage of the claim process is Stephanie currently working? - answer-Investigation
If a claimant has a history of similar claims, that could mean: - answer-It is important to
investigate for fraud
If an insurer is unwilling to pay what the claimant is asking, the adjuster must: - answer-
Negotiate a settlement
An insurance adjuster acts as a fiduciary agent for her employer. Which of the following
statements is FALSE about the adjuster's role as a fiduciary agent? - answer-The
adjuster may not give the claimant materials showing how he came up with the
settlement amount
A staff adjuster is a: - answer-Salaried employee working for only one insurer
Marlene has been living in her $120,000 home for 31 years. Because she has paid off
the mortgage, she decides to save some money on her monthly insurance premiums by
reducing her homeowners coverage to $40,000. After a severe hail storm totals her
roof, her adjuster estimates the damage at $12,000. Assuming the insure imposes the
standard coinsurance penalty, and ignoring the deductible, how much will Marlene
receive in the settlement amount? - answer-$5,000
Craig has an HO-3 policy covering his primary residence with a Coverage A limit of
$250,000, Coverage B limit of $25,000, and a Coverage C limit of $150,000. Craig also
has a cabin on the lake, which was burglarized. The thieves stole much of the cabin's
contents, for a total loss of $18,500. Ignoring any deductibles, how much will Craig's
HO-3 policy pay for this claim? - answer-$15,000
Stan built a porch for his home three years ago at a cost of $10,000. The value of the
porch has depreciated by $6,000, and it would cost $12,000 to replace it today. After
Stan's porch burnt down during a BBQ today, how much would a Standard Fire Policy
indemnify Stan for his porch? - answer-$6,000
Which of the following statements is NOT true of endorsements? - answer-And
endorsed policy will always provide more coverage than an unendorsed policy
In a dwelling policy, how much will the Fire Department Service charge coverage pay? -
answer-Up to $500 if the fire department charges for responding to a covered peril
Bill's new home is in the final stages of construction, and he has purchased an HO-2
policy to ensure his financial interest in the property. This morning, Bill's contractor calls
to tell him that an electrical fire has destroyed his new kitchen, and all of the crown
molding that was supposed to be installed today has been stolen. It will be $15,000 to
rebuild the kitchen and another $4,200 to replace the trim. How will Bill's ensure
, respond when he files a claim? - answer-His insurer will pay $15,000 for a build the
kitchen and nothing for the stolen trim
Which of the following statements about the original standard fire policy is FALSE? -
answer-It was the first multi-line policy, combining both Physical Damage and Liability
coverages
During a severe wind storm, a large tree in Jeff's yard was blown down in two large
bushes were ripped from the ground. Jeff has an HO-3. What is the maximum amount
that Jeff can receive for the replacement of the tree and bushes that were damaged by
the wind storm? - answer-$0
For loss settlement purposes, most homeowners policies: - answer-Pay for damages to
personal property at actual cash value, and damages to structures at replacement cost
Tim's $2500 boat trailer was stolen from his driveway. Ignoring any deductibles, how
much contingency for his stolen trailer when he files a claim against his homeowners
policy? - answer-$1,500
Helen's business is growing rapidly, so she decided to add an annex onto her office
and hire another worker. While under construction, a storm blows down most of the
annex structure, forcing Helen to restart from scratch. Her commercial policy provides
insurance coverage equal to 75% of the property value, despite the fact that her policy
requires 80% coverage to be fully insured. Which coverage extension could help Helen
rebuild at replacement cost? - answer-None - Extensions are only available at the
policyholder maintains the minimum level of insurance of 80% to value
A fire burns down Jenny's hardware, leaving virtually nothing salvageable. Which of the
following items would not be covered under coverage A of the building and personal
property coverage form in her commercial property policy? - answer-An employees
laptop what she uses for work
What BOP endorsement would cover accompanies lost business income and extra
expense due to loss of electrical service? - answer-Utility time element
When the high-pressure feeder malfunction at the ACME paper mill, The resulting
explosion severely damaged the mill and shut down operations for almost 2 months.
Once the repairs are finished, the city inspector comes out to inspect the work and finds
that the required scrubber needs to be replaced in order to meet current Industry safety
standards. Which coverage could help ACME with this added expense? - answer-Law
and ordinance coverage
According to the commercial property policy, a commercial building is considered
vacant if less than ___ of the available square footage is occupied for ___ consecutive
days. - answer-31%, 60
EXAM WITH ANSWERS
Jane has $150,000 homeowners policy with a 3% percentage deductible. One night, In
oven fire destroys her kitchen, causing $50,000 in damage. How much of the damage
falls under Janes responsibility? - answer-$4,500
Xavier owns a small insurance company. Recently the company want to bid to ensure a
new housing development in Omaha, Nebraska. His company can handle any claims
that arise, but if a series of tornadoes were to tear through the area and destroy the
entire development, Xavier's company would suffer financially. Which type of insure
could help Xavier's company protect itself the most from this potential loss? - answer-A
re-insurer
Which of the following situations does NOT involve an instance of "pure risk?" - answer-
Loss of money invested in the stock market
Which of the following is an insurable risk? - answer-A football stadium
A lightning strike causes one of those storage buildings on John's farm to burn to the
ground, added by the fuel tanks he kept in the building. John knows he wasn't
supposed to store any fuel in the building, so he kept that piece of information to
himself when he files a claim. John's ensure made and I his claim based on his: -
answer-Concealment
Chain shed burned to the ground during a tornado, when the Highwinds break a wall of
the shed, knocking over a lantern inside. What is the proximate cause of the loss? -
answer-Wind
Kevin plays in a brass band using two rare antique Alexander tubas. Since they are no
longer produced, the value of the tubas is difficult to determine. Which type of policy
would best indemnify Kevin in this event that his two boys were damaged, lost, or
stolen? - answer-Agreed value policy
Which settlement option is most often use when the claimant misses work because of a
bodily injury, but a settlement has not been reached? - answer-Advance payment
settlement
Adjuster Andy is trying to determine a final settlement amount for Stacy's claim. Stacy's
house was destroyed in a house fire and it will cost $185,000 to rebuild it. Stacy's
homeowner policy has a limit of $178,000 and $1800 deductible. Typically, how much
would adjuster Andy calculate Stacy's final settlement amount to be - answer-$178,000
,Stephanie is in the process of addressing George's auto claim. Currently she is
interviewing Shana, who witnessed George's accident and stopped to help. In what
stage of the claim process is Stephanie currently working? - answer-Investigation
If a claimant has a history of similar claims, that could mean: - answer-It is important to
investigate for fraud
If an insurer is unwilling to pay what the claimant is asking, the adjuster must: - answer-
Negotiate a settlement
An insurance adjuster acts as a fiduciary agent for her employer. Which of the following
statements is FALSE about the adjuster's role as a fiduciary agent? - answer-The
adjuster may not give the claimant materials showing how he came up with the
settlement amount
A staff adjuster is a: - answer-Salaried employee working for only one insurer
Marlene has been living in her $120,000 home for 31 years. Because she has paid off
the mortgage, she decides to save some money on her monthly insurance premiums by
reducing her homeowners coverage to $40,000. After a severe hail storm totals her
roof, her adjuster estimates the damage at $12,000. Assuming the insure imposes the
standard coinsurance penalty, and ignoring the deductible, how much will Marlene
receive in the settlement amount? - answer-$5,000
Craig has an HO-3 policy covering his primary residence with a Coverage A limit of
$250,000, Coverage B limit of $25,000, and a Coverage C limit of $150,000. Craig also
has a cabin on the lake, which was burglarized. The thieves stole much of the cabin's
contents, for a total loss of $18,500. Ignoring any deductibles, how much will Craig's
HO-3 policy pay for this claim? - answer-$15,000
Stan built a porch for his home three years ago at a cost of $10,000. The value of the
porch has depreciated by $6,000, and it would cost $12,000 to replace it today. After
Stan's porch burnt down during a BBQ today, how much would a Standard Fire Policy
indemnify Stan for his porch? - answer-$6,000
Which of the following statements is NOT true of endorsements? - answer-And
endorsed policy will always provide more coverage than an unendorsed policy
In a dwelling policy, how much will the Fire Department Service charge coverage pay? -
answer-Up to $500 if the fire department charges for responding to a covered peril
Bill's new home is in the final stages of construction, and he has purchased an HO-2
policy to ensure his financial interest in the property. This morning, Bill's contractor calls
to tell him that an electrical fire has destroyed his new kitchen, and all of the crown
molding that was supposed to be installed today has been stolen. It will be $15,000 to
rebuild the kitchen and another $4,200 to replace the trim. How will Bill's ensure
, respond when he files a claim? - answer-His insurer will pay $15,000 for a build the
kitchen and nothing for the stolen trim
Which of the following statements about the original standard fire policy is FALSE? -
answer-It was the first multi-line policy, combining both Physical Damage and Liability
coverages
During a severe wind storm, a large tree in Jeff's yard was blown down in two large
bushes were ripped from the ground. Jeff has an HO-3. What is the maximum amount
that Jeff can receive for the replacement of the tree and bushes that were damaged by
the wind storm? - answer-$0
For loss settlement purposes, most homeowners policies: - answer-Pay for damages to
personal property at actual cash value, and damages to structures at replacement cost
Tim's $2500 boat trailer was stolen from his driveway. Ignoring any deductibles, how
much contingency for his stolen trailer when he files a claim against his homeowners
policy? - answer-$1,500
Helen's business is growing rapidly, so she decided to add an annex onto her office
and hire another worker. While under construction, a storm blows down most of the
annex structure, forcing Helen to restart from scratch. Her commercial policy provides
insurance coverage equal to 75% of the property value, despite the fact that her policy
requires 80% coverage to be fully insured. Which coverage extension could help Helen
rebuild at replacement cost? - answer-None - Extensions are only available at the
policyholder maintains the minimum level of insurance of 80% to value
A fire burns down Jenny's hardware, leaving virtually nothing salvageable. Which of the
following items would not be covered under coverage A of the building and personal
property coverage form in her commercial property policy? - answer-An employees
laptop what she uses for work
What BOP endorsement would cover accompanies lost business income and extra
expense due to loss of electrical service? - answer-Utility time element
When the high-pressure feeder malfunction at the ACME paper mill, The resulting
explosion severely damaged the mill and shut down operations for almost 2 months.
Once the repairs are finished, the city inspector comes out to inspect the work and finds
that the required scrubber needs to be replaced in order to meet current Industry safety
standards. Which coverage could help ACME with this added expense? - answer-Law
and ordinance coverage
According to the commercial property policy, a commercial building is considered
vacant if less than ___ of the available square footage is occupied for ___ consecutive
days. - answer-31%, 60
