Insurance adjuster exam questions Test
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During a storm, heavy winds cause a tree limb to break and fall onto Paul's house, causing $6,500 in
damage. Paul's insurance company now considers his house: ANS: A Loss
Which of the following best describes a "risk," according to the insurance definition? ANS: A potential
for financial loss
A lion at a zoo escaped when a zoo employee failed to follow protocol. The lion injured a zoo patron. In
court, the injured patron's lawyer could invoke the doctrine of: ANS: Res Ipsa Loquitur.
Which of the following best defines the doctrine of Res Ipsa Loquitur? ANS: The circumstances of the
injury make it obvious that the defendant is negligent; no proof is needed.
Nina's home is located in a high crime neighborhood. One day, she comes home from work to find that
her garage door had been spray-painted with graffiti. Nina's insurer would consider the act of vandalism
to Nina's garage a: ANS: Peril
An economic device used to protect against the risk of realizing unforeseen and extraordinary financial
loss is called: ANS: A Peril
Anytown Pediatrics has been having a hard time finding medical malpractice insurance. The premiums
are extraordinarily high, and they get higher every year. Finally, fed up with the cost of insurance, the
directors decide to form their own insurance company, which will serve only Anytown Pediatrics. This
way, any profits generated by the insurer will come back to Anytown Pediatrics. What kind of insurance
company would this be? ANS: Captive insurer
In an insurance contract, exclusions serve all of the following purposes, except: ANS: add coverages that
need special treatment.
,Sam was tired of the neighbor's trees along the fence line poking through the fence and dropping leaves
in his yard, so he reached across the fence with his pole saw and cut down the neighbor's tree. Sam's
neighbor was upset and sued him for the damages. Sam is ordered to pay $500 for the tree. Under
which category of damage would this fall? ANS: Compensory Damage
Jackie recently inherited a life-sized marble statue of her great-grandfather. It is an irreplaceable
antique, and it is nearly impossible to determine the ACV. Which type of policy would best indemnify
Jackie in the event that the statue was ever damaged? ANS: Agreed Value Policy
ABC Consulting has a CGL policy and an Umbrella policy, but the CGL runs from January 1 to December
31 and the Umbrella policy runs from June 1 to May 31. This difference in inception and expiration dates
creates confusion when settling claims. This condition is known as: ANS: Nonconcurency
A power surge sparks a small electrical fire in an office building. The electrical fire triggers the automatic
sprinkler system. The water from the sprinklers soaks the carpets and shorts-out all the computers,
causing thousands of dollars in damage. The office must close for two months during repairs. The
sprinklers soaking the office would be considered: ANS: An occurrence
Sara's vehicle was stolen and her insurer paid her theft claim for the total value of the car. A week later,
the police found Sara's car and returned it to her. Which of the following statements is true? ANS: The
Recovered Property provision states that Sara must notify the insurer and either return the settlement
payment or surrender the vehicle to the insurer.
As Seth is driving along a country road, a deer jumps out in front of him. This causes Seth to veer off the
road and crash into Cassie's wood fence and a brick mailbox. As a result of the crash, Seth suffers $3,700
in damage to his sedan and causes $1,800 in damage to Cassie's property. How much of the damage will
be covered by Seth's liability insurance? ANS: $1800
Which of the following sequences is most likely in the correct chronological order? ANS: Acknowledge
the claim, then open a line of communication with the claimant.
Appraisal is used to decide: ANS: the settlement amount
, The adjusters preliminary report would most likely not include: ANS: The settlement amount
Which of the following is least likely to be one of the important questions an adjuster must answer
before entering into the negotiations process? ANS: How much is the insured willing to pay
Sylvia is in the process of building an addition onto her used book store, which is insured under a
commercial property policy. About 40 days into the process, her mother takes a bad fall and breaks her
hip. Seeing that she needs to move closer to her mom, Sylvia sells the book store. Her Builder's Risk
coverage is terminated because: ANS: Sylvia no longer has insurable interest in the bui;ding
Sarah and a carload of her friends are driving to Vermont for the weekend when she hits a deer, causing
$10,000 in damages to her car and $5,000 in medical bills for herself and her passengers. Which
insurance coverage will pay for the damages to Sarah's car? ANS: Comprehensive
What document do insurance companies give to claimants when they think something in the claim is not
covered by the policy, but they are not sure yet? ANS: Reservation of rights letter
Jared is fishing from his 22-foot sailboat when he is caught in a sudden hailstorm. His boat suffers
extensive hail damage. When he files a claim against his homeowners policy, he is upset to learn that his
claim is denied because: ANS: the boat was not fully enclosed inside a building during the hailstorm.
Which ISO is known as the Condominium form? ANS: Homeowners 6
Bill's home was destroyed by a tornado, and Nick is adjusting the claim. Bill's home will cost $235,000 to
rebuild. His homeowners policy has a $225,000 limit and a $1,700 deductible. How much would Nick
typically calculate the final settlement amount to be? ANS: $225,000
After a hail storm passed through his neighborhood, Perry had his roof inspected by a local contractor.
The contractor gave Perry an estimate of $9,850 to replace his roof, so he filed a claim with his insurer.
The adjuster came up with her own estimate of $9,645 to replace Perry's roof. How will the adjuster
bank
During a storm, heavy winds cause a tree limb to break and fall onto Paul's house, causing $6,500 in
damage. Paul's insurance company now considers his house: ANS: A Loss
Which of the following best describes a "risk," according to the insurance definition? ANS: A potential
for financial loss
A lion at a zoo escaped when a zoo employee failed to follow protocol. The lion injured a zoo patron. In
court, the injured patron's lawyer could invoke the doctrine of: ANS: Res Ipsa Loquitur.
Which of the following best defines the doctrine of Res Ipsa Loquitur? ANS: The circumstances of the
injury make it obvious that the defendant is negligent; no proof is needed.
Nina's home is located in a high crime neighborhood. One day, she comes home from work to find that
her garage door had been spray-painted with graffiti. Nina's insurer would consider the act of vandalism
to Nina's garage a: ANS: Peril
An economic device used to protect against the risk of realizing unforeseen and extraordinary financial
loss is called: ANS: A Peril
Anytown Pediatrics has been having a hard time finding medical malpractice insurance. The premiums
are extraordinarily high, and they get higher every year. Finally, fed up with the cost of insurance, the
directors decide to form their own insurance company, which will serve only Anytown Pediatrics. This
way, any profits generated by the insurer will come back to Anytown Pediatrics. What kind of insurance
company would this be? ANS: Captive insurer
In an insurance contract, exclusions serve all of the following purposes, except: ANS: add coverages that
need special treatment.
,Sam was tired of the neighbor's trees along the fence line poking through the fence and dropping leaves
in his yard, so he reached across the fence with his pole saw and cut down the neighbor's tree. Sam's
neighbor was upset and sued him for the damages. Sam is ordered to pay $500 for the tree. Under
which category of damage would this fall? ANS: Compensory Damage
Jackie recently inherited a life-sized marble statue of her great-grandfather. It is an irreplaceable
antique, and it is nearly impossible to determine the ACV. Which type of policy would best indemnify
Jackie in the event that the statue was ever damaged? ANS: Agreed Value Policy
ABC Consulting has a CGL policy and an Umbrella policy, but the CGL runs from January 1 to December
31 and the Umbrella policy runs from June 1 to May 31. This difference in inception and expiration dates
creates confusion when settling claims. This condition is known as: ANS: Nonconcurency
A power surge sparks a small electrical fire in an office building. The electrical fire triggers the automatic
sprinkler system. The water from the sprinklers soaks the carpets and shorts-out all the computers,
causing thousands of dollars in damage. The office must close for two months during repairs. The
sprinklers soaking the office would be considered: ANS: An occurrence
Sara's vehicle was stolen and her insurer paid her theft claim for the total value of the car. A week later,
the police found Sara's car and returned it to her. Which of the following statements is true? ANS: The
Recovered Property provision states that Sara must notify the insurer and either return the settlement
payment or surrender the vehicle to the insurer.
As Seth is driving along a country road, a deer jumps out in front of him. This causes Seth to veer off the
road and crash into Cassie's wood fence and a brick mailbox. As a result of the crash, Seth suffers $3,700
in damage to his sedan and causes $1,800 in damage to Cassie's property. How much of the damage will
be covered by Seth's liability insurance? ANS: $1800
Which of the following sequences is most likely in the correct chronological order? ANS: Acknowledge
the claim, then open a line of communication with the claimant.
Appraisal is used to decide: ANS: the settlement amount
, The adjusters preliminary report would most likely not include: ANS: The settlement amount
Which of the following is least likely to be one of the important questions an adjuster must answer
before entering into the negotiations process? ANS: How much is the insured willing to pay
Sylvia is in the process of building an addition onto her used book store, which is insured under a
commercial property policy. About 40 days into the process, her mother takes a bad fall and breaks her
hip. Seeing that she needs to move closer to her mom, Sylvia sells the book store. Her Builder's Risk
coverage is terminated because: ANS: Sylvia no longer has insurable interest in the bui;ding
Sarah and a carload of her friends are driving to Vermont for the weekend when she hits a deer, causing
$10,000 in damages to her car and $5,000 in medical bills for herself and her passengers. Which
insurance coverage will pay for the damages to Sarah's car? ANS: Comprehensive
What document do insurance companies give to claimants when they think something in the claim is not
covered by the policy, but they are not sure yet? ANS: Reservation of rights letter
Jared is fishing from his 22-foot sailboat when he is caught in a sudden hailstorm. His boat suffers
extensive hail damage. When he files a claim against his homeowners policy, he is upset to learn that his
claim is denied because: ANS: the boat was not fully enclosed inside a building during the hailstorm.
Which ISO is known as the Condominium form? ANS: Homeowners 6
Bill's home was destroyed by a tornado, and Nick is adjusting the claim. Bill's home will cost $235,000 to
rebuild. His homeowners policy has a $225,000 limit and a $1,700 deductible. How much would Nick
typically calculate the final settlement amount to be? ANS: $225,000
After a hail storm passed through his neighborhood, Perry had his roof inspected by a local contractor.
The contractor gave Perry an estimate of $9,850 to replace his roof, so he filed a claim with his insurer.
The adjuster came up with her own estimate of $9,645 to replace Perry's roof. How will the adjuster
