Florida 6-20 All Lines Adjuster
Test| 276 questions| 44 pages|
with complete solutions
Course
Adjuster
1. Which of the following best describes the primary duty of an insurance adjuster?
A. Sell insurance policies
B. Investigate, evaluate, and settle claims according to the policy
C. Set insurance premium rates
D. Underwrite commercial risks
Answer: B. Investigate, evaluate, and settle claims according to the policy
Rationale: An adjuster's primary responsibility is to determine coverage, investigate the facts,
evaluate damages, and settle claims fairly and in accordance with the insurance contract.
2. What is the principle of indemnity?
A. The insured should profit from a covered loss.
B. The insured should be restored to approximately the same financial position occupied before
the loss.
C. Every claim is paid at replacement cost.
D. The insurer pays every claimed loss regardless of policy terms.
Answer: B
Rationale: Indemnity prevents the insured from profiting from insurance and seeks to restore
them to their pre-loss financial condition.
3. Which type of hazard refers to a person's dishonesty or intent to cause a loss?
A. Physical hazard
B. Moral hazard
C. Morale hazard
D. Legal hazard
Answer: B
,Rationale: Moral hazards involve intentional dishonesty, fraud, or deliberate actions that
increase the likelihood of loss.
4. Which document outlines the insurer's promise to pay covered losses?
A. Insurance application
B. Insurance policy
C. Premium receipt
D. Inspection report
Answer: B
Rationale: The insurance policy is the legal contract that defines coverage, exclusions,
conditions, and the insurer's obligations.
5. Which section of an insurance policy identifies what is NOT covered?
A. Declarations
B. Insuring Agreement
C. Exclusions
D. Endorsements
Answer: C
Rationale: Exclusions specify losses, perils, or property that the policy does not insure.
6. An adjuster should always handle claim investigations with:
A. Bias toward the insurer
B. Fairness, objectivity, and professionalism
C. Bias toward the claimant
D. Personal opinion
Answer: B
Rationale: Adjusters have a duty to conduct fair, impartial investigations based on facts and
policy provisions.
7. Actual Cash Value (ACV) is generally defined as:
,A. Replacement Cost plus depreciation
B. Replacement Cost minus depreciation
C. Market price only
D. Original purchase price
Answer: B
Rationale: ACV accounts for depreciation and reflects the property's value at the time of loss.
8. Which coverage generally pays for damage caused by fire to an insured dwelling?
A. Liability Coverage
B. Property Coverage
C. Medical Payments Coverage
D. Collision Coverage
Answer: B
Rationale: Fire damage to the insured structure is generally covered under property insurance.
9. What is subrogation?
A. The insured cancels the policy.
B. The insurer seeks reimbursement from the responsible third party after paying a claim.
C. The insured files two claims.
D. The insurer refuses coverage.
Answer: B
Rationale: Subrogation allows the insurer to recover claim payments from the party legally
responsible for the loss.
10. Which party bears the burden of proving a covered loss occurred?
A. The insurer
B. The insured or claimant
C. The insurance agent
D. The state insurance department
Answer: B
, Rationale: The claimant must demonstrate that a covered loss occurred before benefits are
payable.
11. Which homeowners coverage protects against lawsuits for bodily injury or property
damage to others?
A. Coverage A
B. Coverage C
C. Coverage E
D. Coverage D
Answer: C
Rationale: Coverage E provides Personal Liability protection.
12. An adjuster discovers evidence suggesting possible insurance fraud. The adjuster should:
A. Ignore the evidence.
B. Document findings and follow company procedures for suspected fraud.
C. Automatically deny the claim.
D. Accuse the insured immediately.
Answer: B
Rationale: Suspected fraud should be documented and referred through proper investigative
channels.
13. Which type of loss is generally excluded under a standard homeowners policy?
A. Fire
B. Lightning
C. Flood
D. Windstorm
Answer: C
Rationale: Flood damage is generally excluded and requires separate flood insurance.
14. A deductible primarily serves to:
Test| 276 questions| 44 pages|
with complete solutions
Course
Adjuster
1. Which of the following best describes the primary duty of an insurance adjuster?
A. Sell insurance policies
B. Investigate, evaluate, and settle claims according to the policy
C. Set insurance premium rates
D. Underwrite commercial risks
Answer: B. Investigate, evaluate, and settle claims according to the policy
Rationale: An adjuster's primary responsibility is to determine coverage, investigate the facts,
evaluate damages, and settle claims fairly and in accordance with the insurance contract.
2. What is the principle of indemnity?
A. The insured should profit from a covered loss.
B. The insured should be restored to approximately the same financial position occupied before
the loss.
C. Every claim is paid at replacement cost.
D. The insurer pays every claimed loss regardless of policy terms.
Answer: B
Rationale: Indemnity prevents the insured from profiting from insurance and seeks to restore
them to their pre-loss financial condition.
3. Which type of hazard refers to a person's dishonesty or intent to cause a loss?
A. Physical hazard
B. Moral hazard
C. Morale hazard
D. Legal hazard
Answer: B
,Rationale: Moral hazards involve intentional dishonesty, fraud, or deliberate actions that
increase the likelihood of loss.
4. Which document outlines the insurer's promise to pay covered losses?
A. Insurance application
B. Insurance policy
C. Premium receipt
D. Inspection report
Answer: B
Rationale: The insurance policy is the legal contract that defines coverage, exclusions,
conditions, and the insurer's obligations.
5. Which section of an insurance policy identifies what is NOT covered?
A. Declarations
B. Insuring Agreement
C. Exclusions
D. Endorsements
Answer: C
Rationale: Exclusions specify losses, perils, or property that the policy does not insure.
6. An adjuster should always handle claim investigations with:
A. Bias toward the insurer
B. Fairness, objectivity, and professionalism
C. Bias toward the claimant
D. Personal opinion
Answer: B
Rationale: Adjusters have a duty to conduct fair, impartial investigations based on facts and
policy provisions.
7. Actual Cash Value (ACV) is generally defined as:
,A. Replacement Cost plus depreciation
B. Replacement Cost minus depreciation
C. Market price only
D. Original purchase price
Answer: B
Rationale: ACV accounts for depreciation and reflects the property's value at the time of loss.
8. Which coverage generally pays for damage caused by fire to an insured dwelling?
A. Liability Coverage
B. Property Coverage
C. Medical Payments Coverage
D. Collision Coverage
Answer: B
Rationale: Fire damage to the insured structure is generally covered under property insurance.
9. What is subrogation?
A. The insured cancels the policy.
B. The insurer seeks reimbursement from the responsible third party after paying a claim.
C. The insured files two claims.
D. The insurer refuses coverage.
Answer: B
Rationale: Subrogation allows the insurer to recover claim payments from the party legally
responsible for the loss.
10. Which party bears the burden of proving a covered loss occurred?
A. The insurer
B. The insured or claimant
C. The insurance agent
D. The state insurance department
Answer: B
, Rationale: The claimant must demonstrate that a covered loss occurred before benefits are
payable.
11. Which homeowners coverage protects against lawsuits for bodily injury or property
damage to others?
A. Coverage A
B. Coverage C
C. Coverage E
D. Coverage D
Answer: C
Rationale: Coverage E provides Personal Liability protection.
12. An adjuster discovers evidence suggesting possible insurance fraud. The adjuster should:
A. Ignore the evidence.
B. Document findings and follow company procedures for suspected fraud.
C. Automatically deny the claim.
D. Accuse the insured immediately.
Answer: B
Rationale: Suspected fraud should be documented and referred through proper investigative
channels.
13. Which type of loss is generally excluded under a standard homeowners policy?
A. Fire
B. Lightning
C. Flood
D. Windstorm
Answer: C
Rationale: Flood damage is generally excluded and requires separate flood insurance.
14. A deductible primarily serves to:
