NC ADJUSTER LICENSE EXAM 2025
QUESTIONS AND ANSWERS
Insurance Services Office - ANS Calculates rates and creates policy forms such as
homeowners and auto for property and casualty insurers.
National Association of Insurance Commissioners (NAIC) - ANS governing org. for all state
insurance commissioners, directors. Works towards standardization of insurance codes in
various states. All legislation passed is non-binding on the states until passed by the state
legislative.
Domestic Insurers - ANS organized under the laws of the same state in which they are
domiciled.
Foreign Insurers - ANS Formed under the laws of a different state from the one in which they
are doing business.
Alien Insurers - ANS Formed under the laws of another country from the one in which they
are doing business in.
Indemnity Contract - ANS Contract type that promises to pay an amount equal to the loss
covered under the policy.
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, Reimbursement Contract - ANS Is a contract type which reimburses expenses.
Valued Contract - ANS A contract type in which the insurer agrees to pay a specific sum of
money no matter what the amount of loss may be. Ex. Life Insurance
Adverse Selection - ANS Selection of such a risk has a greater than average chance of
producing a loss.
Estoppel - ANS Legal impediment to one party denying the consequences of its own actions.
Pro-Rata - ANS Insurance company must return any advanced unused premium paid by the
policy owner if the insurance company terminates the contract before policy ends.
Risk - ANS Uncertainty of a financial loss
Speculative Risk - ANS Uncertain prospect of a financial gain or loss and are uninsurable. Ex.
Lottery
Pure Risk - ANS Involving a chance of loss or no loss, but no gain, and are insurable.
Risk Avoidance - ANS Ensures that an individual or business does not get involved in an
activity leading to a potential financial loss.
Risk Assumption - ANS Is a method in which the individual or business assumes the expected
losses from its own financial resources.
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Risk Transference - ANS Transfer of risk to an insurance company.
Page
@COPYRIGHT SIRJOEL 2025/2026
QUESTIONS AND ANSWERS
Insurance Services Office - ANS Calculates rates and creates policy forms such as
homeowners and auto for property and casualty insurers.
National Association of Insurance Commissioners (NAIC) - ANS governing org. for all state
insurance commissioners, directors. Works towards standardization of insurance codes in
various states. All legislation passed is non-binding on the states until passed by the state
legislative.
Domestic Insurers - ANS organized under the laws of the same state in which they are
domiciled.
Foreign Insurers - ANS Formed under the laws of a different state from the one in which they
are doing business.
Alien Insurers - ANS Formed under the laws of another country from the one in which they
are doing business in.
Indemnity Contract - ANS Contract type that promises to pay an amount equal to the loss
covered under the policy.
1
Page
@COPYRIGHT SIRJOEL 2025/2026
, Reimbursement Contract - ANS Is a contract type which reimburses expenses.
Valued Contract - ANS A contract type in which the insurer agrees to pay a specific sum of
money no matter what the amount of loss may be. Ex. Life Insurance
Adverse Selection - ANS Selection of such a risk has a greater than average chance of
producing a loss.
Estoppel - ANS Legal impediment to one party denying the consequences of its own actions.
Pro-Rata - ANS Insurance company must return any advanced unused premium paid by the
policy owner if the insurance company terminates the contract before policy ends.
Risk - ANS Uncertainty of a financial loss
Speculative Risk - ANS Uncertain prospect of a financial gain or loss and are uninsurable. Ex.
Lottery
Pure Risk - ANS Involving a chance of loss or no loss, but no gain, and are insurable.
Risk Avoidance - ANS Ensures that an individual or business does not get involved in an
activity leading to a potential financial loss.
Risk Assumption - ANS Is a method in which the individual or business assumes the expected
losses from its own financial resources.
2
Risk Transference - ANS Transfer of risk to an insurance company.
Page
@COPYRIGHT SIRJOEL 2025/2026
