CA Adjusters License PSI Exam
Questions With Correct Answers
Other bstructures bare bexcluded bfrom bcoverage bunder bthe bHO-3 bwhen bthey bare:
Smaller bthan b100 bsquare bfeet bor blarger bthan b1,000 bsquare bfeet b
Smaller bthan b100 bsquare bfeet bor blarger bthan b500 bsquare bfeet b
Used bfor bstorage bpurposes b
Used bfor bbusiness bpurposes b- bcorrect banswers✔✔Used bfor bbusiness bpurposes bis
bcorrect.
EXPLANATION:
When bthe bother bstructures bare bused bfor bbusiness bpurposes bthey bare bnot bcovered
bunder bthe bhomeowner bform. bThis bstructure band bits bcontents bcould bbe bcovered
bunder ba bcommercial bproperty bpolicy. bAn bexception bwould bbe ba bdetached
bstructure bused bto bstore bbusiness bproperty bof ba bnon-flammable, bnon-gaseous
bnature.
An binsurance bcompany bmust bgive bhow bmany bdays bnotice bof bcancellation bfor ba
bvacancy bof bmore bthan b60 bdays, bwhen bthe bgovernment bhas bordered bdemolition,
bor bwhen bfixed bitems bare bbeing bremoved band bnot breplaced?
5b
21 b
10 b
30 b- bcorrect banswers✔✔5 bis bcorrect.
EXPLANATION:
The bcancellation bchanges bendorsement bis bthe b"mandatory bendorsement" breferred
bto bin bthe bquestion. bIn bCalifornia, bthe bendorsement bmust bbe bincluded bin bevery
bcommercial bproperty bpolicy. bIt ballows bcancellation bby bthe binsurer bwith b5 bdays'
bnotice bfor bseveral breasons: bvacancy bor bunoccupancy bfor b60 bor bmore bdays;
bdamages bfrom ba bprior bcovered bloss bhaven't bbeen bstarted; bthe bgovernment bhas
bordered bdemolition bor bto bvacate; bfixed bitems bare bbeing bremoved band bnot
breplaced; band, butilities bare bshut boff bfor b30 bor bmore bdays, bor bproperty btaxes bare
bmore bthan bone byear bpast bdue.
,Upon brequest bmade bby bthe bconsumer, ba bperson bwho bprocures ban binvestigative
bconsumer breport bon bthe bconsumer bmust bmake ba bcomplete band baccurate
bdisclosure bto bthe bconsumer bof bthe bnature bof bthe breport band binvestigation bwithin:
In bwriting band bmailed bto bthe bconsumer bwithin b30 bdays bof bthe brequest. b
In bwriting band bmailed bto bthe bconsumer bwithin b15 bdays bof bthe brequest. b
In bwriting band bmailed bto bthe bconsumer bwithin b10 bdays bof bthe brequest. b
In bwriting band bmailed bto bthe bconsumer bwithin b5 bdays bof bthe brequest. b- bcorrect
banswers✔✔In bwriting band bmailed bto bthe bconsumer bwithin b5 bdays bof bthe brequest..
EXPLANATION:
This bdisclosure bmust bbe bmade bin bwriting band bmailed bor botherwise bdelivered bto
bthe bconsumer bno blater bthan bfive bdays bafter bthe bdate bon bwhich bthe brequest bfor
bthe bdisclosure bwas breceived bfrom bthe bconsumer.
The binsured bhas bprimary bbodily binjury band bproperty bdamage bliability bcoverage bwith
ba b$100,000 blimit, band ba b$1 bmillion bumbrella bliability bpolicy bwith ba b$5,000 bself-
insured bretention blimit. bIn bwhich bone bof bthe bfollowing bsituations bwould bthe
binsured's bumbrella bliability bpolicy btypically bnot bprovide bdefense bcoverage?
Answer bChoices: bSelect bthe bCorrect bAnswer
Five bpeople bsued bthe binsured bfor bproperty bdamage barising bout bof bone boccurrence.
bOne bof bthe bcases bwas bsettled bout bof bcourt bfor b$100,000. b
The binsured bwas bsued bfor b$150,000 bin bpersonal binjury bdamages. b
The binsured bwas bsued bfor b$10,000 bin bbodily binjury bdamages. b
The bumbrella bliability bpolicy bwould bprovide ba bdefense bin ball bthree bcases. b- bcorrect
banswers✔✔The bcorrect banswer bis: bThe binsured bwas bsued bfor b$10,000 bin bbodily
binjury bdamages. b
EXPLANATION:
The bclaim bwould bfall bunder bthe bunderlying bcoverage band bnot bthe bumbrella
bbecause bthe bunderlying bcoverage bhas bsufficient blimits bin bplace.
Question b5 bof b100
The bBAP bliability bexclusion bpertaining bto bpollution bremoves bcoverage bfor beach bof
bthe bfollowing, bexcept:
Answer bChoices: bSelect bthe bCorrect bAnswer
The bcost bof bgovernmentally bordered bclean-up bof bpollutants. b
The bescape bof bpollutants bwhile bbeing btransported bby ba bcovered bauto. b
The bescape bof bpollutants bcaused bby bdamage bto bthe bproperty bcontaining bthem
bwhen bthe bdamage bresults bfrom bthe buse bof ba bcovered bauto. b
The bescape bof bpollutants bbefore bthey bare baccepted bby bthe binsured bfor bmovement
bonto ba bcovered bauto. b- bcorrect banswers✔✔The bescape bof bpollutants bcaused bby
bdamage bto bthe bproperty bcontaining bthem bwhen bthe bdamage bresults bfrom bthe buse
bof ba bcovered bauto. bis bcorrect.
EXPLANATION:
,If bthe binsured's bvehicle bcauses ban baccident bwith banother bvehicle bor bother bproperty
b(owned bby ba bthird bparty) bcontaining bthe bpollutants, bthe bloss bis bcovered.
Which bof bthe bfollowing bwould bnot bbe bcovered bunder bthe bspecified bcause bof bloss
bphysical bdamage bcoverage bunder bthe bcommercial bauto bform?
Glass bbreakage b
Fire b
Lightning b
Flood b- bcorrect banswers✔✔The bcorrect banswer bis: bGlass bbreakage.
EXPLANATION:
The bspecified bcause bof bloss bform bcovers bthe bfollowing bperils: bfire, blighting,
bexplosion, btheft, bwindstorm, bhail, bearthquake, bflood, bvandalism bor bmischief,
btransportation bby ba bconveyance. bThe bcoverage bdoes bnot binclude bglass bbreakage,
bhitting ba bbird bor banimal bnor bfalling bobjects bor bmissiles.
All bof bthe bfollowing bevents bare bconsidered bacts bof bterrorism, bEXCEPT:
Acts bof briot band bcivil bcommotion. b
Acts bconsidered bdangerous bto bhuman blife, bproperty bor binfrastructure. b
Acts bresulting bin bdamage bwithin bor boutside bthe bUnited bStates. b
Acts bat bthe bpremises bof bany bUnited bStates bmission. b- bcorrect banswers✔✔The
bcorrect banswer bis: bActs bof briot band bcivil bcommotion. b.
EXPLANATION:
Acts bof briot band bcivil bcommotion bare bnot bcovered bby bthe bAct. bThese bare bperils
bthat bare bcovered bby bproperty binsurance bpolicies.
A bcompany bor bstaff badjuster brepresents bthe binterests bof:
The binsurer. b
The binsured. b
The bclaimant. b
The bpublic. b- bcorrect banswers✔✔The binsurer. bis bcorrect.
EXPLANATION:
Company bor bstaff badjusters bare bindividuals bemployed bby ba bproperty band bcasualty
binsurance bcompany bto bsettle bon bits bbehalf bclaims bbrought bby binsureds. bThey
bwork bdirectly bfor bthe binsurance bcompany bas byear-round bsalaried bemployees. bStaff
badjusters bevaluate bthe bmerits bof beach bclaim band bmake brecommendations bto bthe
binsurance bcompany.
Under bthe bPersonal bAuto bPolicy bthe bSupplementary bPayments bcoverage bis:
Answer bChoices: bSelect bthe bCorrect bAnswer
In baddition bto bthe blimit bof bliability. b
Added bby bendorsement. b
Included bin bthe blimit bof bliability. b
, Not bavailable bunder bthe bpersonal bauto bpolicy. b- bcorrect banswers✔✔In baddition bto
bthe blimit bof bliability. bis bcorrect.
EXPLANATION:
Supplementary bPayments bare bin baddition bto bthe bLimits bof bLiability.
When ba bfirst bparty bclaim bis bmade, bwhat bmust bbe blisted bon bthe bpayment bdraft?
Answer bChoices: bSelect bthe bCorrect bAnswer
Type bof bcoverage bunder bwhich bpayment bis bmade b
Details bof bthe baccident b
Application bof bthe bdeductible b
Drivers blicense bnumber b- bcorrect banswers✔✔Type bof bcoverage bunder bwhich
bpayment bis bmade bis bcorrect.
EXPLANATION:
When ba bclaim bpayment bis bmade, ban bindication bof bthe btype bof bcoverage bunder
bwhich bthe bpayment bis bmade bmust bbe bstated bon bthe bdraft bpayment.
Under bthe bCommercial bProperty bPolicy, bthe bPro-rata bLiability bClause bmeans:
Answer bChoices: bSelect bthe bCorrect bAnswer
Each binsurer bpays bits blimits bunder bthe bpolicy. b
Neither bInsurer bPays b
Each binsurer bpays bin baccordance bto bthe bpercentage bof bits bcoverage bbears bto bthe
btotal bamount bof binsurance. b
A bForm bof bCoinsurance bClause b- bcorrect banswers✔✔Each binsurer bpays bin
baccordance bto bthe bpercentage bof bits bcoverage bbears bto bthe btotal bamount bof
binsurance. bis bcorrect.
EXPLANATION:
The binsurer bwill bnot bbe bliable bfor ba bgreater bproportion bof ba bloss bthan bthe bamount
binsured bwill bbear bto bthe bwhole binsurance bcovering bthe bproperty bagainst bthe bperil
binvolved, bwhether bcollectible bor bnot. bThis bis boften breferred bto bas bthe b"Other
bInsurance" bclause.
David bhas bdamaged bhis bvehicle bby bstriking ba btree. bHe bcan:
I. bTake bthe bcar bto ba brepair bgarage brecommended bby bthe binsurer.
II. bTake bthe bcar bto ba bgarage bof bhis bchoice.
III. bAccept bpayment bbased bon bthe badjuster's bestimate.
Answer bChoices: bSelect bthe bCorrect bAnswer
I, bII band bIII b
I band bII bonly b
I band bIII bonly b
I bonly b- bcorrect banswers✔✔I, bII band bIII bis bcorrect.
EXPLANATION:
The bchoice bbelongs bto bthe bDavid, bthe binsured.
Under ba bfarm bpolicy, bwhich bof bthe bfollowing bwould bbe bcovered bunder bCoverage
bA?
Answer bChoices: bSelect bthe bCorrect bAnswer
Questions With Correct Answers
Other bstructures bare bexcluded bfrom bcoverage bunder bthe bHO-3 bwhen bthey bare:
Smaller bthan b100 bsquare bfeet bor blarger bthan b1,000 bsquare bfeet b
Smaller bthan b100 bsquare bfeet bor blarger bthan b500 bsquare bfeet b
Used bfor bstorage bpurposes b
Used bfor bbusiness bpurposes b- bcorrect banswers✔✔Used bfor bbusiness bpurposes bis
bcorrect.
EXPLANATION:
When bthe bother bstructures bare bused bfor bbusiness bpurposes bthey bare bnot bcovered
bunder bthe bhomeowner bform. bThis bstructure band bits bcontents bcould bbe bcovered
bunder ba bcommercial bproperty bpolicy. bAn bexception bwould bbe ba bdetached
bstructure bused bto bstore bbusiness bproperty bof ba bnon-flammable, bnon-gaseous
bnature.
An binsurance bcompany bmust bgive bhow bmany bdays bnotice bof bcancellation bfor ba
bvacancy bof bmore bthan b60 bdays, bwhen bthe bgovernment bhas bordered bdemolition,
bor bwhen bfixed bitems bare bbeing bremoved band bnot breplaced?
5b
21 b
10 b
30 b- bcorrect banswers✔✔5 bis bcorrect.
EXPLANATION:
The bcancellation bchanges bendorsement bis bthe b"mandatory bendorsement" breferred
bto bin bthe bquestion. bIn bCalifornia, bthe bendorsement bmust bbe bincluded bin bevery
bcommercial bproperty bpolicy. bIt ballows bcancellation bby bthe binsurer bwith b5 bdays'
bnotice bfor bseveral breasons: bvacancy bor bunoccupancy bfor b60 bor bmore bdays;
bdamages bfrom ba bprior bcovered bloss bhaven't bbeen bstarted; bthe bgovernment bhas
bordered bdemolition bor bto bvacate; bfixed bitems bare bbeing bremoved band bnot
breplaced; band, butilities bare bshut boff bfor b30 bor bmore bdays, bor bproperty btaxes bare
bmore bthan bone byear bpast bdue.
,Upon brequest bmade bby bthe bconsumer, ba bperson bwho bprocures ban binvestigative
bconsumer breport bon bthe bconsumer bmust bmake ba bcomplete band baccurate
bdisclosure bto bthe bconsumer bof bthe bnature bof bthe breport band binvestigation bwithin:
In bwriting band bmailed bto bthe bconsumer bwithin b30 bdays bof bthe brequest. b
In bwriting band bmailed bto bthe bconsumer bwithin b15 bdays bof bthe brequest. b
In bwriting band bmailed bto bthe bconsumer bwithin b10 bdays bof bthe brequest. b
In bwriting band bmailed bto bthe bconsumer bwithin b5 bdays bof bthe brequest. b- bcorrect
banswers✔✔In bwriting band bmailed bto bthe bconsumer bwithin b5 bdays bof bthe brequest..
EXPLANATION:
This bdisclosure bmust bbe bmade bin bwriting band bmailed bor botherwise bdelivered bto
bthe bconsumer bno blater bthan bfive bdays bafter bthe bdate bon bwhich bthe brequest bfor
bthe bdisclosure bwas breceived bfrom bthe bconsumer.
The binsured bhas bprimary bbodily binjury band bproperty bdamage bliability bcoverage bwith
ba b$100,000 blimit, band ba b$1 bmillion bumbrella bliability bpolicy bwith ba b$5,000 bself-
insured bretention blimit. bIn bwhich bone bof bthe bfollowing bsituations bwould bthe
binsured's bumbrella bliability bpolicy btypically bnot bprovide bdefense bcoverage?
Answer bChoices: bSelect bthe bCorrect bAnswer
Five bpeople bsued bthe binsured bfor bproperty bdamage barising bout bof bone boccurrence.
bOne bof bthe bcases bwas bsettled bout bof bcourt bfor b$100,000. b
The binsured bwas bsued bfor b$150,000 bin bpersonal binjury bdamages. b
The binsured bwas bsued bfor b$10,000 bin bbodily binjury bdamages. b
The bumbrella bliability bpolicy bwould bprovide ba bdefense bin ball bthree bcases. b- bcorrect
banswers✔✔The bcorrect banswer bis: bThe binsured bwas bsued bfor b$10,000 bin bbodily
binjury bdamages. b
EXPLANATION:
The bclaim bwould bfall bunder bthe bunderlying bcoverage band bnot bthe bumbrella
bbecause bthe bunderlying bcoverage bhas bsufficient blimits bin bplace.
Question b5 bof b100
The bBAP bliability bexclusion bpertaining bto bpollution bremoves bcoverage bfor beach bof
bthe bfollowing, bexcept:
Answer bChoices: bSelect bthe bCorrect bAnswer
The bcost bof bgovernmentally bordered bclean-up bof bpollutants. b
The bescape bof bpollutants bwhile bbeing btransported bby ba bcovered bauto. b
The bescape bof bpollutants bcaused bby bdamage bto bthe bproperty bcontaining bthem
bwhen bthe bdamage bresults bfrom bthe buse bof ba bcovered bauto. b
The bescape bof bpollutants bbefore bthey bare baccepted bby bthe binsured bfor bmovement
bonto ba bcovered bauto. b- bcorrect banswers✔✔The bescape bof bpollutants bcaused bby
bdamage bto bthe bproperty bcontaining bthem bwhen bthe bdamage bresults bfrom bthe buse
bof ba bcovered bauto. bis bcorrect.
EXPLANATION:
,If bthe binsured's bvehicle bcauses ban baccident bwith banother bvehicle bor bother bproperty
b(owned bby ba bthird bparty) bcontaining bthe bpollutants, bthe bloss bis bcovered.
Which bof bthe bfollowing bwould bnot bbe bcovered bunder bthe bspecified bcause bof bloss
bphysical bdamage bcoverage bunder bthe bcommercial bauto bform?
Glass bbreakage b
Fire b
Lightning b
Flood b- bcorrect banswers✔✔The bcorrect banswer bis: bGlass bbreakage.
EXPLANATION:
The bspecified bcause bof bloss bform bcovers bthe bfollowing bperils: bfire, blighting,
bexplosion, btheft, bwindstorm, bhail, bearthquake, bflood, bvandalism bor bmischief,
btransportation bby ba bconveyance. bThe bcoverage bdoes bnot binclude bglass bbreakage,
bhitting ba bbird bor banimal bnor bfalling bobjects bor bmissiles.
All bof bthe bfollowing bevents bare bconsidered bacts bof bterrorism, bEXCEPT:
Acts bof briot band bcivil bcommotion. b
Acts bconsidered bdangerous bto bhuman blife, bproperty bor binfrastructure. b
Acts bresulting bin bdamage bwithin bor boutside bthe bUnited bStates. b
Acts bat bthe bpremises bof bany bUnited bStates bmission. b- bcorrect banswers✔✔The
bcorrect banswer bis: bActs bof briot band bcivil bcommotion. b.
EXPLANATION:
Acts bof briot band bcivil bcommotion bare bnot bcovered bby bthe bAct. bThese bare bperils
bthat bare bcovered bby bproperty binsurance bpolicies.
A bcompany bor bstaff badjuster brepresents bthe binterests bof:
The binsurer. b
The binsured. b
The bclaimant. b
The bpublic. b- bcorrect banswers✔✔The binsurer. bis bcorrect.
EXPLANATION:
Company bor bstaff badjusters bare bindividuals bemployed bby ba bproperty band bcasualty
binsurance bcompany bto bsettle bon bits bbehalf bclaims bbrought bby binsureds. bThey
bwork bdirectly bfor bthe binsurance bcompany bas byear-round bsalaried bemployees. bStaff
badjusters bevaluate bthe bmerits bof beach bclaim band bmake brecommendations bto bthe
binsurance bcompany.
Under bthe bPersonal bAuto bPolicy bthe bSupplementary bPayments bcoverage bis:
Answer bChoices: bSelect bthe bCorrect bAnswer
In baddition bto bthe blimit bof bliability. b
Added bby bendorsement. b
Included bin bthe blimit bof bliability. b
, Not bavailable bunder bthe bpersonal bauto bpolicy. b- bcorrect banswers✔✔In baddition bto
bthe blimit bof bliability. bis bcorrect.
EXPLANATION:
Supplementary bPayments bare bin baddition bto bthe bLimits bof bLiability.
When ba bfirst bparty bclaim bis bmade, bwhat bmust bbe blisted bon bthe bpayment bdraft?
Answer bChoices: bSelect bthe bCorrect bAnswer
Type bof bcoverage bunder bwhich bpayment bis bmade b
Details bof bthe baccident b
Application bof bthe bdeductible b
Drivers blicense bnumber b- bcorrect banswers✔✔Type bof bcoverage bunder bwhich
bpayment bis bmade bis bcorrect.
EXPLANATION:
When ba bclaim bpayment bis bmade, ban bindication bof bthe btype bof bcoverage bunder
bwhich bthe bpayment bis bmade bmust bbe bstated bon bthe bdraft bpayment.
Under bthe bCommercial bProperty bPolicy, bthe bPro-rata bLiability bClause bmeans:
Answer bChoices: bSelect bthe bCorrect bAnswer
Each binsurer bpays bits blimits bunder bthe bpolicy. b
Neither bInsurer bPays b
Each binsurer bpays bin baccordance bto bthe bpercentage bof bits bcoverage bbears bto bthe
btotal bamount bof binsurance. b
A bForm bof bCoinsurance bClause b- bcorrect banswers✔✔Each binsurer bpays bin
baccordance bto bthe bpercentage bof bits bcoverage bbears bto bthe btotal bamount bof
binsurance. bis bcorrect.
EXPLANATION:
The binsurer bwill bnot bbe bliable bfor ba bgreater bproportion bof ba bloss bthan bthe bamount
binsured bwill bbear bto bthe bwhole binsurance bcovering bthe bproperty bagainst bthe bperil
binvolved, bwhether bcollectible bor bnot. bThis bis boften breferred bto bas bthe b"Other
bInsurance" bclause.
David bhas bdamaged bhis bvehicle bby bstriking ba btree. bHe bcan:
I. bTake bthe bcar bto ba brepair bgarage brecommended bby bthe binsurer.
II. bTake bthe bcar bto ba bgarage bof bhis bchoice.
III. bAccept bpayment bbased bon bthe badjuster's bestimate.
Answer bChoices: bSelect bthe bCorrect bAnswer
I, bII band bIII b
I band bII bonly b
I band bIII bonly b
I bonly b- bcorrect banswers✔✔I, bII band bIII bis bcorrect.
EXPLANATION:
The bchoice bbelongs bto bthe bDavid, bthe binsured.
Under ba bfarm bpolicy, bwhich bof bthe bfollowing bwould bbe bcovered bunder bCoverage
bA?
Answer bChoices: bSelect bthe bCorrect bAnswer
