CA Adjusters License PSI questions and
answers 2025\2026 A+ Grade
Other structures are excluded from coverage under the HO-3 when they are:
Smaller than 100 square feet or larger than 1,000 square feet
Smaller than 100 square feet or larger than 500 square feet
Used for storage purposes
Used for business purposes
- correct answer Used for business purposes is correct.
EXPLANATION:
When the other structures are used for business purposes they are not covered under the homeowner
form. This structure and its contents could be covered under a commercial property policy. An exception
would be a detached structure used to store business property of a non-flammable, non-gaseous
nature.
An insurance company must give how many days notice of cancellation for a vacancy of more than 60
days, when the government has ordered demolition, or when fixed items are being removed and not
replaced?
5
21
10
30
- correct answer 5 is correct.
EXPLANATION:
The cancellation changes endorsement is the "mandatory endorsement" referred to in the question. In
California, the endorsement must be included in every commercial property policy. It allows cancellation
by the insurer with 5 days' notice for several reasons: vacancy or unoccupancy for 60 or more days;
damages from a prior covered loss haven't been started; the government has ordered demolition or to
,vacate; fixed items are being removed and not replaced; and, utilities are shut off for 30 or more days,
or property taxes are more than one year past due.
Upon request made by the consumer, a person who procures an investigative consumer report on the
consumer must make a complete and accurate disclosure to the consumer of the nature of the report
and investigation within:
In writing and mailed to the consumer within 30 days of the request.
In writing and mailed to the consumer within 15 days of the request.
In writing and mailed to the consumer within 10 days of the request.
In writing and mailed to the consumer within 5 days of the request.
- correct answer In writing and mailed to the consumer within 5 days of the request..
EXPLANATION:
This disclosure must be made in writing and mailed or otherwise delivered to the consumer no later
than five days after the date on which the request for the disclosure was received from the consumer.
The insured has primary bodily injury and property damage liability coverage with a $100,000 limit, and
a $1 million umbrella liability policy with a $5,000 self-insured retention limit. In which one of the
following situations would the insured's umbrella liability policy typically not provide defense coverage?
Answer Choices: Select the Correct Answer
Five people sued the insured for property damage arising out of one occurrence. One of the cases was
settled out of court for $100,000.
The insured was sued for $150,000 in personal injury damages.
The insured was sued for $10,000 in bodily injury damages.
The umbrella liability policy would provide a defense in all three cases.
- correct answer The correct answer is: The insured was sued for $10,000 in bodily injury damages.
EXPLANATION:
The claim would fall under the underlying coverage and not the umbrella because the underlying
coverage has sufficient limits in place.
Question 5 of 100
,The BAP liability exclusion pertaining to pollution removes coverage for each of the following, except:
Answer Choices: Select the Correct Answer
The cost of governmentally ordered clean-up of pollutants.
The escape of pollutants while being transported by a covered auto.
The escape of pollutants caused by damage to the property containing them when the damage results
from the use of a covered auto.
The escape of pollutants before they are accepted by the insured for movement onto a covered auto.
- correct answer The escape of pollutants caused by damage to the property containing them when the
damage results from the use of a covered auto. is correct.
EXPLANATION:
If the insured's vehicle causes an accident with another vehicle or other property (owned by a third
party) containing the pollutants, the loss is covered.
Which of the following would not be covered under the specified cause of loss physical damage
coverage under the commercial auto form?
Glass breakage
Fire
Lightning
Flood
- correct answer The correct answer is: Glass breakage.
EXPLANATION:
The specified cause of loss form covers the following perils: fire, lighting, explosion, theft, windstorm,
hail, earthquake, flood, vandalism or mischief, transportation by a conveyance. The coverage does not
include glass breakage, hitting a bird or animal nor falling objects or missiles.
All of the following events are considered acts of terrorism, EXCEPT:
Acts of riot and civil commotion.
Acts considered dangerous to human life, property or infrastructure.
Acts resulting in damage within or outside the United States.
, Acts at the premises of any United States mission.
- correct answer The correct answer is: Acts of riot and civil commotion. .
EXPLANATION:
Acts of riot and civil commotion are not covered by the Act. These are perils that are covered by
property insurance policies.
A company or staff adjuster represents the interests of:
The insurer.
The insured.
The claimant.
The public.
- correct answer The insurer. is correct.
EXPLANATION:
Company or staff adjusters are individuals employed by a property and casualty insurance company to
settle on its behalf claims brought by insureds. They work directly for the insurance company as year-
round salaried employees. Staff adjusters evaluate the merits of each claim and make recommendations
to the insurance company.
Under the Personal Auto Policy the Supplementary Payments coverage is:
Answer Choices: Select the Correct Answer
In addition to the limit of liability.
Added by endorsement.
Included in the limit of liability.
Not available under the personal auto policy.
- correct answer In addition to the limit of liability. is correct.
EXPLANATION:
Supplementary Payments are in addition to the Limits of Liability.
When a first party claim is made, what must be listed on the payment draft?
Answer Choices: Select the Correct Answer
answers 2025\2026 A+ Grade
Other structures are excluded from coverage under the HO-3 when they are:
Smaller than 100 square feet or larger than 1,000 square feet
Smaller than 100 square feet or larger than 500 square feet
Used for storage purposes
Used for business purposes
- correct answer Used for business purposes is correct.
EXPLANATION:
When the other structures are used for business purposes they are not covered under the homeowner
form. This structure and its contents could be covered under a commercial property policy. An exception
would be a detached structure used to store business property of a non-flammable, non-gaseous
nature.
An insurance company must give how many days notice of cancellation for a vacancy of more than 60
days, when the government has ordered demolition, or when fixed items are being removed and not
replaced?
5
21
10
30
- correct answer 5 is correct.
EXPLANATION:
The cancellation changes endorsement is the "mandatory endorsement" referred to in the question. In
California, the endorsement must be included in every commercial property policy. It allows cancellation
by the insurer with 5 days' notice for several reasons: vacancy or unoccupancy for 60 or more days;
damages from a prior covered loss haven't been started; the government has ordered demolition or to
,vacate; fixed items are being removed and not replaced; and, utilities are shut off for 30 or more days,
or property taxes are more than one year past due.
Upon request made by the consumer, a person who procures an investigative consumer report on the
consumer must make a complete and accurate disclosure to the consumer of the nature of the report
and investigation within:
In writing and mailed to the consumer within 30 days of the request.
In writing and mailed to the consumer within 15 days of the request.
In writing and mailed to the consumer within 10 days of the request.
In writing and mailed to the consumer within 5 days of the request.
- correct answer In writing and mailed to the consumer within 5 days of the request..
EXPLANATION:
This disclosure must be made in writing and mailed or otherwise delivered to the consumer no later
than five days after the date on which the request for the disclosure was received from the consumer.
The insured has primary bodily injury and property damage liability coverage with a $100,000 limit, and
a $1 million umbrella liability policy with a $5,000 self-insured retention limit. In which one of the
following situations would the insured's umbrella liability policy typically not provide defense coverage?
Answer Choices: Select the Correct Answer
Five people sued the insured for property damage arising out of one occurrence. One of the cases was
settled out of court for $100,000.
The insured was sued for $150,000 in personal injury damages.
The insured was sued for $10,000 in bodily injury damages.
The umbrella liability policy would provide a defense in all three cases.
- correct answer The correct answer is: The insured was sued for $10,000 in bodily injury damages.
EXPLANATION:
The claim would fall under the underlying coverage and not the umbrella because the underlying
coverage has sufficient limits in place.
Question 5 of 100
,The BAP liability exclusion pertaining to pollution removes coverage for each of the following, except:
Answer Choices: Select the Correct Answer
The cost of governmentally ordered clean-up of pollutants.
The escape of pollutants while being transported by a covered auto.
The escape of pollutants caused by damage to the property containing them when the damage results
from the use of a covered auto.
The escape of pollutants before they are accepted by the insured for movement onto a covered auto.
- correct answer The escape of pollutants caused by damage to the property containing them when the
damage results from the use of a covered auto. is correct.
EXPLANATION:
If the insured's vehicle causes an accident with another vehicle or other property (owned by a third
party) containing the pollutants, the loss is covered.
Which of the following would not be covered under the specified cause of loss physical damage
coverage under the commercial auto form?
Glass breakage
Fire
Lightning
Flood
- correct answer The correct answer is: Glass breakage.
EXPLANATION:
The specified cause of loss form covers the following perils: fire, lighting, explosion, theft, windstorm,
hail, earthquake, flood, vandalism or mischief, transportation by a conveyance. The coverage does not
include glass breakage, hitting a bird or animal nor falling objects or missiles.
All of the following events are considered acts of terrorism, EXCEPT:
Acts of riot and civil commotion.
Acts considered dangerous to human life, property or infrastructure.
Acts resulting in damage within or outside the United States.
, Acts at the premises of any United States mission.
- correct answer The correct answer is: Acts of riot and civil commotion. .
EXPLANATION:
Acts of riot and civil commotion are not covered by the Act. These are perils that are covered by
property insurance policies.
A company or staff adjuster represents the interests of:
The insurer.
The insured.
The claimant.
The public.
- correct answer The insurer. is correct.
EXPLANATION:
Company or staff adjusters are individuals employed by a property and casualty insurance company to
settle on its behalf claims brought by insureds. They work directly for the insurance company as year-
round salaried employees. Staff adjusters evaluate the merits of each claim and make recommendations
to the insurance company.
Under the Personal Auto Policy the Supplementary Payments coverage is:
Answer Choices: Select the Correct Answer
In addition to the limit of liability.
Added by endorsement.
Included in the limit of liability.
Not available under the personal auto policy.
- correct answer In addition to the limit of liability. is correct.
EXPLANATION:
Supplementary Payments are in addition to the Limits of Liability.
When a first party claim is made, what must be listed on the payment draft?
Answer Choices: Select the Correct Answer
