THE NC ADJUSTER LICENSE EXAM PREP MATERIAL NEWEST 2025/2026
COMPLETE QUESTIONS AND CORRECT DETAILED SOLUTIONS (VERIFIED
SOLUTIONS)|BRAND NEW VERSION
Spencer is covered under a standard Personal Automobile policy with a policy inception date of
October 15th. Additionally, the policy will expire on October 15th of the current year. Spencer
contacts his agent on October 7th and asks to have an new endorsement added to his policy.
The agent agrees, adds the coverage the same day, and informs Spencer that there will be an
additional premium of $20 per month charged. When will the adjustment of premium be
effective for Spencer? - SOLUTION-October 7th
A blanket employee dishonesty bond will: - SOLUTION-Does not name the individuals.
Under what circumstances does an insurer allow the transfer of an insured's rights and duties
under a Commercial Package Policy without the permission of the insurer? - SOLUTION-When
the named insured dies
An insured has purchased a DP-3 policy to cover his dwelling that is valued at a replacement
cost of $100,000. He insures it for $60,000 and later suffers a $30,000 fire loss. Which of the
following amounts will be paid by the policy (if no deductible form is attached)? -
SOLUTION$22,500
The insuring agreements of an Equipment Breakdown policy, provides coverage for: -
SOLUTIONFirst party coverages and property damage to property of others
If the insured, covered under a Homeowners policy, suffers the loss of an article that is part of a
pair or set. All of the following are options for the insurer to settle the loss, EXCEPT: - SOLUTION-
Pay for the replacement cost of the entire pair or set
,When someone dies without a will, their assets will be handled by a court appointed: -
SOLUTION-Administrator.
Emily owns a home that she has covered under a Homeowners policy. Because Emily lives alone,
she had to leave her home and stay with her parents for the past six months while she recovers
from major surgery. Except for the day-to-day items that Emily needs while she stays at her
parents' home, all of her other belongings are still located in her home. Which of the following
best describes the condition of Emily's home? - SOLUTION-Unoccupied
The insured carries a yacht policy. One of the crew members is injured while performing a work
related task. What coverage must be added under the policy that would respond to cover the
crew member's injuries? - SOLUTION-Jones Act
Manny is purchasing a Commercial Property policy with a Business Income form included.
Manny can select from any of the following as a method to provide coverage, while avoiding the
coinsurance requirement, EXCEPT: - SOLUTION-The maximum monthly limit of indemnity
optional coverage
The traditional definition of actual cash value (ACV) is: - SOLUTION-Replacement cost minus
depreciation
Sam and Dan are working to clean out the gutters around the roof on Sam's house. Sam and
Dan are standing at the top of separate ladders that are propped against the side of Sam's
house, when Dan's ladder begins to wobble and ultimately falls into Sam's ladder. Both men and
their ladders crash to the ground. Whose injuries will be covered by Sam's Homeowners policy
under Coverage E - Personal Liability? - SOLUTION-Only Dan's injuries would be covered
Torts that can be covered by insurance policies include all of the following, EXCEPT: -
SOLUTIONIntentional torts purposely committed to cause harm to another.
, The insured has a $1,000,000 personal umbrella policy with a $5,000 retention limit. For a
$7,000 liability loss not covered under the insured's personal auto policy, but covered under the
umbrella policy, the insurance company would pay: - SOLUTION-$2,000
All of the following is considered an "insured" under a CGL policy, EXCEPT: - SOLUTION-Lawyers
of the named insured
What specific type of liability policy gives an owner protection against liability claims arising out
of the acts of its independent contractors? - SOLUTION-Owners and Contractors Protective
Liability Policy.
Which of the following would be eligible for coverage under a Businessowners policy? -
SOLUTION-A small retail store
Which of the following is NOT a correct statement in determining the cost of a "comparable
automobile" when a physical damage loss has a occurred? - SOLUTION-The cost of a comparable
automobile as determined by a computerized automobile valuation service that produces
statistically valid fair market values within the United States market
All of the following statements are TRUE of North Carolina automobile liability policies, EXCEPT -
SOLUTION-If the insured carries limits greater than the minimum financial responsibility limits
required by state law, they are not required to carry Uninsured/Underinsured Motorists
coverage.
The basic limit for Coverage F -- Medical Payments of the standard Homeowners forms is: -
SOLUTION-$1,000 per person
Oliver Dogwood was in an auto accident which destroyed his car. While investigating the
accident, Adjuster Doright found that Mr. Dogwood paid $1,000 for the vehicle. After checking
with others he found the same vehicle with an asking price of $1,700, a retail price of $2,150
and a dealer price of $1,750. What amount will Mr. Dogwood receive? - SOLUTION-$2,150
COMPLETE QUESTIONS AND CORRECT DETAILED SOLUTIONS (VERIFIED
SOLUTIONS)|BRAND NEW VERSION
Spencer is covered under a standard Personal Automobile policy with a policy inception date of
October 15th. Additionally, the policy will expire on October 15th of the current year. Spencer
contacts his agent on October 7th and asks to have an new endorsement added to his policy.
The agent agrees, adds the coverage the same day, and informs Spencer that there will be an
additional premium of $20 per month charged. When will the adjustment of premium be
effective for Spencer? - SOLUTION-October 7th
A blanket employee dishonesty bond will: - SOLUTION-Does not name the individuals.
Under what circumstances does an insurer allow the transfer of an insured's rights and duties
under a Commercial Package Policy without the permission of the insurer? - SOLUTION-When
the named insured dies
An insured has purchased a DP-3 policy to cover his dwelling that is valued at a replacement
cost of $100,000. He insures it for $60,000 and later suffers a $30,000 fire loss. Which of the
following amounts will be paid by the policy (if no deductible form is attached)? -
SOLUTION$22,500
The insuring agreements of an Equipment Breakdown policy, provides coverage for: -
SOLUTIONFirst party coverages and property damage to property of others
If the insured, covered under a Homeowners policy, suffers the loss of an article that is part of a
pair or set. All of the following are options for the insurer to settle the loss, EXCEPT: - SOLUTION-
Pay for the replacement cost of the entire pair or set
,When someone dies without a will, their assets will be handled by a court appointed: -
SOLUTION-Administrator.
Emily owns a home that she has covered under a Homeowners policy. Because Emily lives alone,
she had to leave her home and stay with her parents for the past six months while she recovers
from major surgery. Except for the day-to-day items that Emily needs while she stays at her
parents' home, all of her other belongings are still located in her home. Which of the following
best describes the condition of Emily's home? - SOLUTION-Unoccupied
The insured carries a yacht policy. One of the crew members is injured while performing a work
related task. What coverage must be added under the policy that would respond to cover the
crew member's injuries? - SOLUTION-Jones Act
Manny is purchasing a Commercial Property policy with a Business Income form included.
Manny can select from any of the following as a method to provide coverage, while avoiding the
coinsurance requirement, EXCEPT: - SOLUTION-The maximum monthly limit of indemnity
optional coverage
The traditional definition of actual cash value (ACV) is: - SOLUTION-Replacement cost minus
depreciation
Sam and Dan are working to clean out the gutters around the roof on Sam's house. Sam and
Dan are standing at the top of separate ladders that are propped against the side of Sam's
house, when Dan's ladder begins to wobble and ultimately falls into Sam's ladder. Both men and
their ladders crash to the ground. Whose injuries will be covered by Sam's Homeowners policy
under Coverage E - Personal Liability? - SOLUTION-Only Dan's injuries would be covered
Torts that can be covered by insurance policies include all of the following, EXCEPT: -
SOLUTIONIntentional torts purposely committed to cause harm to another.
, The insured has a $1,000,000 personal umbrella policy with a $5,000 retention limit. For a
$7,000 liability loss not covered under the insured's personal auto policy, but covered under the
umbrella policy, the insurance company would pay: - SOLUTION-$2,000
All of the following is considered an "insured" under a CGL policy, EXCEPT: - SOLUTION-Lawyers
of the named insured
What specific type of liability policy gives an owner protection against liability claims arising out
of the acts of its independent contractors? - SOLUTION-Owners and Contractors Protective
Liability Policy.
Which of the following would be eligible for coverage under a Businessowners policy? -
SOLUTION-A small retail store
Which of the following is NOT a correct statement in determining the cost of a "comparable
automobile" when a physical damage loss has a occurred? - SOLUTION-The cost of a comparable
automobile as determined by a computerized automobile valuation service that produces
statistically valid fair market values within the United States market
All of the following statements are TRUE of North Carolina automobile liability policies, EXCEPT -
SOLUTION-If the insured carries limits greater than the minimum financial responsibility limits
required by state law, they are not required to carry Uninsured/Underinsured Motorists
coverage.
The basic limit for Coverage F -- Medical Payments of the standard Homeowners forms is: -
SOLUTION-$1,000 per person
Oliver Dogwood was in an auto accident which destroyed his car. While investigating the
accident, Adjuster Doright found that Mr. Dogwood paid $1,000 for the vehicle. After checking
with others he found the same vehicle with an asking price of $1,700, a retail price of $2,150
and a dealer price of $1,750. What amount will Mr. Dogwood receive? - SOLUTION-$2,150
