Public adjuster exam with questions
and well verified answers actual
exam!!! 2026
Declarations - ANSWER -Indentity, address, named insured,policy term, amount of
insurance, liability, policy premium & deductibles of anpolicy
Insuring agreement - ANSWER -Describes covered perils, risk assumed,nature of
coverage or makes reference to the contractual agreement between the insurer & the insured.
Conditions - ANSWER -Set provisions, rules of conduct, duties & obligations of both
parties. Such as the policy period, the insured's obligation to provide proof of loss.
Endorsements - ANSWER -Add, delete or change any of the policy parts.
Abandonment - ANSWER -Insured cannot simply abandon the property to the insurance
company in exchange for the full-insured value.
Appraisal Clause - ANSWER -When there s a dispute over a claim both parties select an
appraiser & the appraisers choose an umpire to settle the dispute.
Arbitration Clause - ANSWER -Appears in Automobile policies to resolve liability
disputes for bodily injury/property damage.
,Exclusions - ANSWER -Perils, hazards or losses arising from specific causes that are not
covered by the policy.
Definitions - ANSWER -Important terms used in the policy language
Assignment - ANSWER -Policy cannot be assigned without written consent of the
insurance company.
Deductible - ANSWER -Part of the claim that the insured is responsible for.
Direct vs Indirect loss - ANSWER -Direct loss is one that is a direct consequence of a
particular peril (Fire damage to an apartment building) The loss of rental as a result of a fire is
an indirect loss.
Excess Insurance - ANSWER -An insurance policy that pays benefits only when the
coverage under other applicable insurance policies has been exhausted.
Indemnity - ANSWER -Claimant should only be restored to the approximate condition
prior to the loss, no better, no worse.
Liberalization - ANSWER -A clause which states that if the policy or endorsement forms
are broadened & no additional premium is required, then all existing similar policies or
endorsements will be construed to include the broaden coverage. Any changes will
automatically be included 45 days of the renewal date without the policy having to be
reprinted.
Primary Insurance - ANSWER -When more than one policy is in place the primary policy
pays first.
Proof of Loss - ANSWER -Form that must be completed by the insured regarding the loss
with 60 days of the date of loss.
Proximate Cause - ANSWER -Unbroken chain of events that causes a loss.
, Vacancy vs Unoccupancy - ANSWER -Vacancy is void of contents & people. Unoccupancy
means premises is void of people.
Cause of loss Forms - ANSWER -State the perils that are to be insured against
Named peril vs open peril - ANSWER -Named peril form lists specific perils to be
covered. Open peril does not list specific perils, it provides broader coverage but may have
exclusions.
Actual Cash Value - ANSWER -The cost of replacement less depreciation
Replacement Cost - ANSWER -The current cost to purchase new with no depreciation.
Functional Replacement Cost - ANSWER -As reasonably close to the replacement cost as
possible.
Market Value - ANSWER -The price that the market will support, often used in losses
involving antiques.
Agreed Value - ANSWER -The value to be insured is agreed by the insured & the insurer.
Stated Amount - ANSWER -An agreed amount that is shown in the policy & will be paid
in the event of a total loss regardless of the actual cash value of the property.
Valued Policy - ANSWER -States that in the event of a total loss, a specific amount will
be paid & that is set as the limit of the policy. Generally used to insure fine arts, jewelry & furs.
Coinsurance Clause - ANSWER -Method of requiring the insured to insure at least 80%
of the value of the property in exchange for a premium discount. This is used on an acv or
replacement cost basis. If policy contains this clause & the insured carries less than the
amount, a penalty will occur in the case pf partial losses.
Example of Coinsurance not being met - ANSWER -Insured carrying 75% of the amount
that should have been carried the insurance company will only pay 75% of the loss. Example
and well verified answers actual
exam!!! 2026
Declarations - ANSWER -Indentity, address, named insured,policy term, amount of
insurance, liability, policy premium & deductibles of anpolicy
Insuring agreement - ANSWER -Describes covered perils, risk assumed,nature of
coverage or makes reference to the contractual agreement between the insurer & the insured.
Conditions - ANSWER -Set provisions, rules of conduct, duties & obligations of both
parties. Such as the policy period, the insured's obligation to provide proof of loss.
Endorsements - ANSWER -Add, delete or change any of the policy parts.
Abandonment - ANSWER -Insured cannot simply abandon the property to the insurance
company in exchange for the full-insured value.
Appraisal Clause - ANSWER -When there s a dispute over a claim both parties select an
appraiser & the appraisers choose an umpire to settle the dispute.
Arbitration Clause - ANSWER -Appears in Automobile policies to resolve liability
disputes for bodily injury/property damage.
,Exclusions - ANSWER -Perils, hazards or losses arising from specific causes that are not
covered by the policy.
Definitions - ANSWER -Important terms used in the policy language
Assignment - ANSWER -Policy cannot be assigned without written consent of the
insurance company.
Deductible - ANSWER -Part of the claim that the insured is responsible for.
Direct vs Indirect loss - ANSWER -Direct loss is one that is a direct consequence of a
particular peril (Fire damage to an apartment building) The loss of rental as a result of a fire is
an indirect loss.
Excess Insurance - ANSWER -An insurance policy that pays benefits only when the
coverage under other applicable insurance policies has been exhausted.
Indemnity - ANSWER -Claimant should only be restored to the approximate condition
prior to the loss, no better, no worse.
Liberalization - ANSWER -A clause which states that if the policy or endorsement forms
are broadened & no additional premium is required, then all existing similar policies or
endorsements will be construed to include the broaden coverage. Any changes will
automatically be included 45 days of the renewal date without the policy having to be
reprinted.
Primary Insurance - ANSWER -When more than one policy is in place the primary policy
pays first.
Proof of Loss - ANSWER -Form that must be completed by the insured regarding the loss
with 60 days of the date of loss.
Proximate Cause - ANSWER -Unbroken chain of events that causes a loss.
, Vacancy vs Unoccupancy - ANSWER -Vacancy is void of contents & people. Unoccupancy
means premises is void of people.
Cause of loss Forms - ANSWER -State the perils that are to be insured against
Named peril vs open peril - ANSWER -Named peril form lists specific perils to be
covered. Open peril does not list specific perils, it provides broader coverage but may have
exclusions.
Actual Cash Value - ANSWER -The cost of replacement less depreciation
Replacement Cost - ANSWER -The current cost to purchase new with no depreciation.
Functional Replacement Cost - ANSWER -As reasonably close to the replacement cost as
possible.
Market Value - ANSWER -The price that the market will support, often used in losses
involving antiques.
Agreed Value - ANSWER -The value to be insured is agreed by the insured & the insurer.
Stated Amount - ANSWER -An agreed amount that is shown in the policy & will be paid
in the event of a total loss regardless of the actual cash value of the property.
Valued Policy - ANSWER -States that in the event of a total loss, a specific amount will
be paid & that is set as the limit of the policy. Generally used to insure fine arts, jewelry & furs.
Coinsurance Clause - ANSWER -Method of requiring the insured to insure at least 80%
of the value of the property in exchange for a premium discount. This is used on an acv or
replacement cost basis. If policy contains this clause & the insured carries less than the
amount, a penalty will occur in the case pf partial losses.
Example of Coinsurance not being met - ANSWER -Insured carrying 75% of the amount
that should have been carried the insurance company will only pay 75% of the loss. Example
