ALABAMA ADJUSTERS LICENSE EXAM QUESTIONS WITH
COMPLETE SOLUTIONS GUARANTEED PASS BRAND NEW
2026
Agency Authority -
Apparent - ANSWER - >Indirect authority that the agent can reasonably be
assumed to have, based on appearances. If an
adjuster is equipped to represent an insurer (with the insurer's
permission), then a n individual can assume that the adjuster has the
authority to act on the insurer's behalf.
Agency Authority -
Express - ANSWER - >Authority that is expressly given to the agent in
writing. Allows the agent to act on behalf of the principal.
,Agency Authority - Implied - ANSWER - >Authority that an
agent possesses by
implication of her behavior, regardless of whether
this authority is
granted in writing. For example, a person portraying herself as a
representative for an
insurance
company, even though she is not employed by
that company.
Agent (Insurance) - ANSWER - >Someone who has received authority from
an insurer to
sell or service insurance
policies.
Agreed Value - ANSWER - >A valued policy in which the insurer and the
insured agree
to a specific value for an item, appraised
at the
inception of the policy. Often used to insure items whose value is difficult
to quantify,
such as antiques
or
fine art. Also called a Guaranteed Value
policy.
Agreement - ANSWER - >One of the four requirements of a legally binding
contract. All parties involved must agr ee to the terms of the contract. Can
also refer to a binder, which is the preliminary substance of a contract.
Agricultural Producer - ANSWER - >A business that grows, harvests, and
sells crops for
profit.
Aleatory - ANSWER - >A characteristic of an insurance contract. Means
"depending on
,an unknown future event." An
insurance
contract will only pay IF and WHEN covered damages occur. Neither party
knows how
much the
contract
will end up paying when they enter into the
contract.
Answer - ANSWER - >In liability cases, the defendant's response to a
complaint. There
are three possible answers: 1)
accept
complaint and pay for damages, 2) deny the complaint, or 3) accept the
complaint with
a right to
insert
evidence into the
case.
Annual Depreciation - ANSWER - >An item's replacement cost divided by
the number of
years in its expected
lifespan.
Annual Transit - ANSWER - >An uncontrolled inland marine form that
covers loss of
goods in transit. It applies to all of the
insured's
shipments during the
year.
Appraisal - ANSWER - >A dispute resolution method which allows the
claimant and the insurer each to select an appraiser. The
two appraisers in turn select an umpire. The appraisers then work together
to determine a settlement
, amount. If they cannot agree, the umpire steps in. Agreement by any two of
the three is binding.
Arbitration - ANSWER - >A dispute resolution method in which the
opposing parties each submit their evidence to a mutuallyagreed-
upon and neutral third party, called an arbitrator. The arbitrator reviews
the positions of each opposing side and makes a final and legally binding
decision.
Arbitrator - ANSWER - >The mutually-agreed-upon and neutral third
party in an
arbitration who reviews the positions
of each
opposing side before making a final and legally binding
decision.
Artificially Generated
Current - ANSWER - >Also called "artificial current." A peril covered in
some property insurance policies. It includes sudden and
accidental damage from any electrical current, except currents that
are naturally generated, such as lightning or static electricity.
Auto Policy - ANSWER - >Insurance policy designed to protect the
policyholder while
owning, occupying, or operating a
vehicle.
Usually combines liability coverage and property coverage into
one policy.
Automobile - ANSWER - >In insurance policies, automobile generally means
any vehicle
designed for use on public
roads.
Automobile No-Fault Laws - ANSWER - >Laws in effect in some states that
require any
COMPLETE SOLUTIONS GUARANTEED PASS BRAND NEW
2026
Agency Authority -
Apparent - ANSWER - >Indirect authority that the agent can reasonably be
assumed to have, based on appearances. If an
adjuster is equipped to represent an insurer (with the insurer's
permission), then a n individual can assume that the adjuster has the
authority to act on the insurer's behalf.
Agency Authority -
Express - ANSWER - >Authority that is expressly given to the agent in
writing. Allows the agent to act on behalf of the principal.
,Agency Authority - Implied - ANSWER - >Authority that an
agent possesses by
implication of her behavior, regardless of whether
this authority is
granted in writing. For example, a person portraying herself as a
representative for an
insurance
company, even though she is not employed by
that company.
Agent (Insurance) - ANSWER - >Someone who has received authority from
an insurer to
sell or service insurance
policies.
Agreed Value - ANSWER - >A valued policy in which the insurer and the
insured agree
to a specific value for an item, appraised
at the
inception of the policy. Often used to insure items whose value is difficult
to quantify,
such as antiques
or
fine art. Also called a Guaranteed Value
policy.
Agreement - ANSWER - >One of the four requirements of a legally binding
contract. All parties involved must agr ee to the terms of the contract. Can
also refer to a binder, which is the preliminary substance of a contract.
Agricultural Producer - ANSWER - >A business that grows, harvests, and
sells crops for
profit.
Aleatory - ANSWER - >A characteristic of an insurance contract. Means
"depending on
,an unknown future event." An
insurance
contract will only pay IF and WHEN covered damages occur. Neither party
knows how
much the
contract
will end up paying when they enter into the
contract.
Answer - ANSWER - >In liability cases, the defendant's response to a
complaint. There
are three possible answers: 1)
accept
complaint and pay for damages, 2) deny the complaint, or 3) accept the
complaint with
a right to
insert
evidence into the
case.
Annual Depreciation - ANSWER - >An item's replacement cost divided by
the number of
years in its expected
lifespan.
Annual Transit - ANSWER - >An uncontrolled inland marine form that
covers loss of
goods in transit. It applies to all of the
insured's
shipments during the
year.
Appraisal - ANSWER - >A dispute resolution method which allows the
claimant and the insurer each to select an appraiser. The
two appraisers in turn select an umpire. The appraisers then work together
to determine a settlement
, amount. If they cannot agree, the umpire steps in. Agreement by any two of
the three is binding.
Arbitration - ANSWER - >A dispute resolution method in which the
opposing parties each submit their evidence to a mutuallyagreed-
upon and neutral third party, called an arbitrator. The arbitrator reviews
the positions of each opposing side and makes a final and legally binding
decision.
Arbitrator - ANSWER - >The mutually-agreed-upon and neutral third
party in an
arbitration who reviews the positions
of each
opposing side before making a final and legally binding
decision.
Artificially Generated
Current - ANSWER - >Also called "artificial current." A peril covered in
some property insurance policies. It includes sudden and
accidental damage from any electrical current, except currents that
are naturally generated, such as lightning or static electricity.
Auto Policy - ANSWER - >Insurance policy designed to protect the
policyholder while
owning, occupying, or operating a
vehicle.
Usually combines liability coverage and property coverage into
one policy.
Automobile - ANSWER - >In insurance policies, automobile generally means
any vehicle
designed for use on public
roads.
Automobile No-Fault Laws - ANSWER - >Laws in effect in some states that
require any
