Texas All Lines Adjuster Test Exam
QUESTIONS & ANSWERS SOLUTION
2026 COMPLETE EXAM | 100%
CORRECT
Accumulated Depreciation - CORRECT ANSWERS The total decrease in an item's value over a
period of time. Formula: (Annual Depreciation x Number of years used)
Acreage Reporting Date - CORRECT ANSWERS The deadline for providing the insurer with an
acreage report, which is used to determine the amount of coverage needed and the premium charged
for a particular crop.
Actual Cash Value (ACV) - CORRECT ANSWERS A valuation method used by insurers to reflect
an item's current market value right before being damaged or destroyed. Formula: (Replacement cost -
Accumulated Depreciation)
Actual Production History - CORRECT ANSWERS A history of a farmer's crop yields over a
multi-year period, which is used to determine the normal production level of a farm.
Adhesion - CORRECT ANSWERS Characteristic of an insurance contract. Means that one party
(the insurer) sets the terms, and the other (the policyholder) can "take it or leave it."
Adjusted Gross Revenue (Crop Insurance) - CORRECT ANSWERS Narrowest (and least
expensive) form of Crop Revenue Insurance. Insures farm revenue as a whole instead of individual crops.
Guarantees a percentage of the insured farm's average revenue.
Adjuster - CORRECT ANSWERS An agent who, for compensation, processes insurance claims.
Can represent either the insured or the insurer.
,Adjuster - Emergency - CORRECT ANSWERS Adjusters who are temporarily licensed by the
insurance commissioner to handle claims during catastrophes or emergencies that produce an
overwhelming number of claims in a short period of time.
Adjuster - Independent - CORRECT ANSWERS Self-employed adjusters who contract with
multiple insurers at the same time. Paid on a commission or fee-plus-expenses basis for each claim. Also
called: Fee Adjuster, Bureau Adjuster
Adjuster - Public - CORRECT ANSWERS An adjuster who is hired to represent the claimant and
help determine a fair indemnification. Usually specializes in appraisals and negotiation. Paid
commission, usually a percentage of final settlement.
Adjuster - Staff - CORRECT ANSWERS Salaried employee of one insurance company who can
work locally, regionally, or nationally. Also called: Company Adjuster
Advance Payment Settlement - CORRECT ANSWERS A settlement option that lets the insurer
offer some financial relief to the claimant before the claim has been fully settled. The insurer makes
advance payments to the claimant, which are then subtracted from the final settlement amount. Often
used when a claimant suffers bodily injury and is unable to work.
Agency Authority - CORRECT ANSWERS The Agent's authority to act on behalf of someone
else, usually an insurer. This authority is derived from the agent's contract with the insurer.
Agency Authority - express - CORRECT ANSWERS Authority that is expressly given to the
agent in writing. Allows agent to act on behalf of the principal.
Agency Authority - implied - CORRECT ANSWERS Authority that an agent possesses by
implication of her behavior, regardless of whether this authority is granted in writing.
Agency Authority - apparent - CORRECT ANSWERS Authority that an agent possesses based
on the appearance of representing the insurer.
,Agent - CORRECT ANSWERS Someone who has received authority from an insurer to sell or
service insurance policies.
Aggregate Limit - CORRECT ANSWERS A type of policy limit found in some health, liability, and
property damage policies. It represents the total amount the insurer will pay for all losses (as opposed to
an occurrence limit, which denotes the total amount the insurer will pay per occurrence).
Agreement - CORRECT ANSWERS One of the four requirements of a legally binding contract.
All parties involved must agree to the terms of the contract. Can also refer to a binder, which is the
preliminary substance of a contract.
Agricultural Producer - CORRECT ANSWERS A business that grows, harvests, and sells crops
for profit.
Aleatory - CORRECT ANSWERS A characteristic of an insurance contract. Means "depending
on an unknown future event." An insurance contract will only pay IF and WHEN covered damages occur.
Neither party knows how much the contract will end up paying when they enter into the contract.
Answer - CORRECT ANSWERS In liability cases, the defendant's response to a complaint.
There are three possible answers: 1) accept complaint and pay for damages, 2) deny the complaint, or 3)
accept the complaint with a right to insert evidence into the case.
Annual Depreciation - CORRECT ANSWERS An item's Replacement cost divided by the
number of years in its expected lifespan.
Appraisal - CORRECT ANSWERS A negotiation method which allows the claimant and the
insurer each to select an appraiser. The two appraisers in turn select an Umpire. The appraisers then
work together to determine a settlement amount. If they cannot agree, the Umpire steps in. Agreement
by any two of the three is binding.
, Arbitration - CORRECT ANSWERS A negotiation method in which the opposing parties each
submit their evidence to a mutually-agreed-upon and neutral third party, called an arbitrator. The
arbitrator reviews the positions of each opposing side, and makes a final and legally binding decision.
Arbitrator - CORRECT ANSWERS The mutually-agreed-upon and neutral third party in an
arbitration who reviews the positions of each opposing side, and makes a final and legally binding
decision.
Artificially Generated Current - CORRECT ANSWERS Also called "artificial current." A peril
covered in some property insurance policies. It includes sudden and accidental damage from any
electrical current, except currents that are naturally generated, such as lightning or static electricity.
Auto Policy - CORRECT ANSWERS Insurance policy designed to protect the policyholder while
owning, occupying, or operating a vehicle. Usually combines liability coverage and property coverage
into one policy.
Automobile - CORRECT ANSWERS In Insurance policies, Automobile generally means any
vehicle designed for use on public roads.
Automobile No-Fault Laws - CORRECT ANSWERS Laws in effect in some states that require
any owner of a vehicle to purchase no-fault insurance; that is, insurance that indemnifies the insured
regardless of who was at fault in an accident. No-fault laws also restrict the insured's right to sue the at-
fault party.
Aviation - CORRECT ANSWERS Aviation insurance combines hull insurance for the aircraft and
liability insurance for any damage to others' property or to people who are not passengers.
Bailee - CORRECT ANSWERS An individual or company that receives the property of someone
else for a special purpose, and returns the product after use.
QUESTIONS & ANSWERS SOLUTION
2026 COMPLETE EXAM | 100%
CORRECT
Accumulated Depreciation - CORRECT ANSWERS The total decrease in an item's value over a
period of time. Formula: (Annual Depreciation x Number of years used)
Acreage Reporting Date - CORRECT ANSWERS The deadline for providing the insurer with an
acreage report, which is used to determine the amount of coverage needed and the premium charged
for a particular crop.
Actual Cash Value (ACV) - CORRECT ANSWERS A valuation method used by insurers to reflect
an item's current market value right before being damaged or destroyed. Formula: (Replacement cost -
Accumulated Depreciation)
Actual Production History - CORRECT ANSWERS A history of a farmer's crop yields over a
multi-year period, which is used to determine the normal production level of a farm.
Adhesion - CORRECT ANSWERS Characteristic of an insurance contract. Means that one party
(the insurer) sets the terms, and the other (the policyholder) can "take it or leave it."
Adjusted Gross Revenue (Crop Insurance) - CORRECT ANSWERS Narrowest (and least
expensive) form of Crop Revenue Insurance. Insures farm revenue as a whole instead of individual crops.
Guarantees a percentage of the insured farm's average revenue.
Adjuster - CORRECT ANSWERS An agent who, for compensation, processes insurance claims.
Can represent either the insured or the insurer.
,Adjuster - Emergency - CORRECT ANSWERS Adjusters who are temporarily licensed by the
insurance commissioner to handle claims during catastrophes or emergencies that produce an
overwhelming number of claims in a short period of time.
Adjuster - Independent - CORRECT ANSWERS Self-employed adjusters who contract with
multiple insurers at the same time. Paid on a commission or fee-plus-expenses basis for each claim. Also
called: Fee Adjuster, Bureau Adjuster
Adjuster - Public - CORRECT ANSWERS An adjuster who is hired to represent the claimant and
help determine a fair indemnification. Usually specializes in appraisals and negotiation. Paid
commission, usually a percentage of final settlement.
Adjuster - Staff - CORRECT ANSWERS Salaried employee of one insurance company who can
work locally, regionally, or nationally. Also called: Company Adjuster
Advance Payment Settlement - CORRECT ANSWERS A settlement option that lets the insurer
offer some financial relief to the claimant before the claim has been fully settled. The insurer makes
advance payments to the claimant, which are then subtracted from the final settlement amount. Often
used when a claimant suffers bodily injury and is unable to work.
Agency Authority - CORRECT ANSWERS The Agent's authority to act on behalf of someone
else, usually an insurer. This authority is derived from the agent's contract with the insurer.
Agency Authority - express - CORRECT ANSWERS Authority that is expressly given to the
agent in writing. Allows agent to act on behalf of the principal.
Agency Authority - implied - CORRECT ANSWERS Authority that an agent possesses by
implication of her behavior, regardless of whether this authority is granted in writing.
Agency Authority - apparent - CORRECT ANSWERS Authority that an agent possesses based
on the appearance of representing the insurer.
,Agent - CORRECT ANSWERS Someone who has received authority from an insurer to sell or
service insurance policies.
Aggregate Limit - CORRECT ANSWERS A type of policy limit found in some health, liability, and
property damage policies. It represents the total amount the insurer will pay for all losses (as opposed to
an occurrence limit, which denotes the total amount the insurer will pay per occurrence).
Agreement - CORRECT ANSWERS One of the four requirements of a legally binding contract.
All parties involved must agree to the terms of the contract. Can also refer to a binder, which is the
preliminary substance of a contract.
Agricultural Producer - CORRECT ANSWERS A business that grows, harvests, and sells crops
for profit.
Aleatory - CORRECT ANSWERS A characteristic of an insurance contract. Means "depending
on an unknown future event." An insurance contract will only pay IF and WHEN covered damages occur.
Neither party knows how much the contract will end up paying when they enter into the contract.
Answer - CORRECT ANSWERS In liability cases, the defendant's response to a complaint.
There are three possible answers: 1) accept complaint and pay for damages, 2) deny the complaint, or 3)
accept the complaint with a right to insert evidence into the case.
Annual Depreciation - CORRECT ANSWERS An item's Replacement cost divided by the
number of years in its expected lifespan.
Appraisal - CORRECT ANSWERS A negotiation method which allows the claimant and the
insurer each to select an appraiser. The two appraisers in turn select an Umpire. The appraisers then
work together to determine a settlement amount. If they cannot agree, the Umpire steps in. Agreement
by any two of the three is binding.
, Arbitration - CORRECT ANSWERS A negotiation method in which the opposing parties each
submit their evidence to a mutually-agreed-upon and neutral third party, called an arbitrator. The
arbitrator reviews the positions of each opposing side, and makes a final and legally binding decision.
Arbitrator - CORRECT ANSWERS The mutually-agreed-upon and neutral third party in an
arbitration who reviews the positions of each opposing side, and makes a final and legally binding
decision.
Artificially Generated Current - CORRECT ANSWERS Also called "artificial current." A peril
covered in some property insurance policies. It includes sudden and accidental damage from any
electrical current, except currents that are naturally generated, such as lightning or static electricity.
Auto Policy - CORRECT ANSWERS Insurance policy designed to protect the policyholder while
owning, occupying, or operating a vehicle. Usually combines liability coverage and property coverage
into one policy.
Automobile - CORRECT ANSWERS In Insurance policies, Automobile generally means any
vehicle designed for use on public roads.
Automobile No-Fault Laws - CORRECT ANSWERS Laws in effect in some states that require
any owner of a vehicle to purchase no-fault insurance; that is, insurance that indemnifies the insured
regardless of who was at fault in an accident. No-fault laws also restrict the insured's right to sue the at-
fault party.
Aviation - CORRECT ANSWERS Aviation insurance combines hull insurance for the aircraft and
liability insurance for any damage to others' property or to people who are not passengers.
Bailee - CORRECT ANSWERS An individual or company that receives the property of someone
else for a special purpose, and returns the product after use.
