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Quizzes > Business & Finance

Free Claims Adjuster Practice Test: 15 Multiple-Choice Questions

Quick, free quiz to assess your skills for the insurance adjuster practice exam. Instant results.

Editorial: Review CompletedCreated By: Sam OldroydUpdated Aug 24, 2025
Difficulty: Moderate
Questions: 20
Learning OutcomesStudy Material
Colorful paper art depicting a quiz on Insurance Adjuster Practice Test

This claims adjuster practice test helps you check your knowledge of claims evaluation, policy rules, and settlements with 15 multiple-choice questions. Build confidence for exam day, and expand your prep with our property and casualty practice exam or the California life insurance practice exam today.

Which valuation method pays to replace damaged property with new property of like kind and quality without deduction for depreciation?
Replacement Cost Value (RCV)
Actual Cash Value (ACV)
Agreed Value
Fair Market Value (FMV)
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In a liability claim, what is the best definition of proximate cause?
The cause that, in a natural and continuous sequence, produced the loss
The first event in a sequence of events
A cause identified by the insured
Any cause that contributed in any degree
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Which policy section lists what perils are NOT covered under a named-peril property policy?
Insuring Agreement
Definitions
Conditions
Exclusions
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Under a homeowners policy, which coverage typically pays for temporary housing when a covered loss makes the residence uninhabitable?
Coverage B - Other Structures
Coverage A - Dwelling
Coverage C - Personal Property
Coverage D - Loss of Use (ALE)
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Which document is typically required from the insured to formally state the facts and amount of a property loss?
Proof of Loss
Certificate of Insurance
Loss Run Report
Reservation of Rights
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What is the primary purpose of a reservation of rights letter?
To advise the insured that coverage is uncertain while the investigation continues
To waive policy defenses during settlement
To deny a claim immediately
To reserve the insurer's right to increase premiums
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When applying depreciation to calculate ACV, which factor is most critical for a building component?
Original purchase price only
Age and useful life of the component
Policy deductible amount
Local building permit fees
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In auto liability claims, what best describes comparative negligence?
The plaintiff recovers only if 0 percent at fault
Fault is apportioned and damages are reduced by each party's percentage of fault
The defendant is always 51 percent at fault
The claim is denied if both parties are at fault
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Which coverage would respond to increased costs to comply with newer building codes after a covered loss?
Medical Payments
Scheduled Personal Property
Collision
Ordinance or Law coverage
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Which scenario most clearly triggers subrogation rights for an insurer?
Loss within policy deductible
Loss caused by a third party's negligence after insurer paid the claim
Insured is fully at fault
Loss results from wear and tear
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In business interruption claims, the period of restoration generally begins on which date?
The date replacement property is ordered
The date of physical loss or damage
The date the initial claim is filed
The date the insurer acknowledges coverage
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Which clause prevents overlapping recovery from both primary and excess policies beyond the total loss?
Appraisal clause
Liberalization clause
Other Insurance clause
Severability clause
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In jurisdictions where insurers withhold general contractor overhead and profit until repairs are contracted and incurred under the policy, which cost is generally included in Replacement Cost but not paid in Actual Cash Value until incurred?
Upgrades for aesthetics
Contractor overhead and profit when general contractor is reasonably necessary
Betterments not required by code
Sales tax on undelivered materials
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Under a claims-made liability policy, which factor is essential for coverage to apply?
The damages are punitive
The insured notifies the agent at any time
The claim is first made during the policy term and after the retroactive date
The loss occurred during the policy term regardless of when the claim is made
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Coinsurance penalties in commercial property can reduce recovery if the limit is below the required percentage of value at time of loss.
True
False
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An anti-concurrent causation clause can bar coverage when an excluded peril contributes to the loss, even if a covered peril also contributed.
True
False
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Spoliation of evidence by an insured can prejudice the insurer's subrogation rights.
True
False
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Punitive damages are mandated to be covered in all jurisdictions under liability policies.
False
True
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A claimant's preexisting condition always bars recovery in a bodily injury liability claim.
False
True
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The notice-prejudice rule in some states requires the insurer to show prejudice to deny a claim for late notice.
False
True
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Learning Outcomes

  1. Identify key principles of property and casualty insurance claims
  2. Apply effective investigation techniques to assess claim validity
  3. Analyse policy terms to determine coverage limits and exclusions
  4. Evaluate damage estimates using industry-standard assessment methods
  5. Demonstrate proper documentation skills for settlement negotiations
  6. Master ethical guidelines governing adjuster conduct

Cheat Sheet

  1. Core Principles of P&C Insurance - Think of indemnity as your safety net when things go sideways, insurable interest as your ticket to play, and utmost good faith as the handshake that seals the deal. These three pillars keep the insurance world standing tall and fair. Dive into the full breakdown to get a foundation that even your future self will thank you for!
  2. Claim Investigation Techniques - Become a detective on the clock by mastering interviews, gathering compelling evidence, and dissecting accident reports like a pro. Sharp investigation skills lead to fair and speedy claim resolutions - and who doesn't love wrapping things up with style? Learn how to ask the right questions and follow the trail of clues.
  3. Decoding Policy Jargon - Policies can read like a secret code, but once you crack definitions, conditions, limits, and endorsements, you'll feel like a coverage ninja. Understanding every twist and turn means no surprises when it's time to pay out. Level up your policy-reading game now!
  4. Accurate Damage Assessments - Armed with industry-standard software and pricing guides, estimating repairs becomes a breeze rather than a guessing game. Consistent methods ensure fairness and speed - both parties win! Brush up on the latest tools to become the gold standard of adjusters.
  5. Mastering Claim Documentation - Detailed records of emails, phone calls, and evidence snippets can be your secret weapon in negotiation battles. Solid documentation not only builds trust but also keeps everything crystal clear if questions pop up later. Make your files so organized even a librarian would cheer!
  6. Ethical Adjuster Conduct - Honesty, integrity, and neutrality aren't just buzzwords - they're your professional superpowers. Following ethical guidelines builds trust and keeps you shining bright in the claims world. Gear up to be the trusted hero every policyholder and insurer relies on.
  7. Spotting Insurance Fraud - Get savvy about common fraud schemes, red flags, and sneaky tricks to protect the integrity of every claim you handle. With fraud detection skills on point, you'll safeguard both the insurer's wallet and honest policyholders. Ready to become a fraud-busting champion?
  8. Understanding Subrogation - Subrogation is your backstage pass to recover costs from responsible third parties, keeping premiums from skyrocketing. Grasp this concept and you'll see how insurers keep balance in the system. It's like the ultimate cost-recovery hack!
  9. Filing Deadlines & Statutes of Limitations - Every state and claim type has its own clock, and missing it means your claim could fizzle out. Staying on top of deadlines ensures your case stays valid - no time travel required! Bookmark these timelines to never miss a beat.
  10. Effective Claims Communication - Polished communication skills turn tense negotiations into friendly chats and build lasting trust with policyholders. A clear, empathetic approach smooths out bumps and gets settlements across the finish line faster. Practice active listening and watch your conversations shine!
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