PA APPRAISERS PRACTICE EXAM
QUESTIONS AND DETAILED SOLUTIONS
2026
▶ replacement cost. Answer: method of valuation based on cost of
replacing an item at current market prices, regardless of depreciation
▶ Functional replacement cost. Answer: pays to replace an outdated,
obsolete item with a functionally equivalent item
▶ Stated amount. Answer: property value is stated by the insured when
applying for insurance
▶ insurance policy. Answer: the legal contract b/w the insurer and the
insured
▶ cancellation and nonrenewal. Answer: insured may cancel at any time,
but the insurer is much more restricted
▶ declarations page. Answer: names of both parties
policy #
location and description of insured item
deductible
premium
,▶ first named insured. Answer: the 1st person or organization listed on the
dec page
▶ additional insured. Answer: person or org. that is added to the policy at
the request of the first named insured and benefits from policy, but is not
allowed to make changed
▶ Loss Payable Clause. Answer: lender listed as loss payee if a loss
occurs
▶ policy limits. Answer: establish the max payout value of an insurance
policy
▶ salvage. Answer: the portion or value of property that remains after a
loss
▶ abandonment clause. Answer: insured is prohibited from forcing the
insurer to take possession of damaged property for the purpose of repair or
disposal
▶ subrogation. Answer: transfer of rights that allows the insurer to recover
its losses after it has indemnified a policyholder
▶ full release settlement. Answer: all damaged paid at once
, ▶ no release settlement. Answer: signing and cashing a check substitutes
for the release form
▶ appraiser. Answer: writes damage estimates for insurance claims
▶ adjuster. Answer: investigates claims and prepares claimant statements
▶ duties of the insured after a loss. Answer: -report all accidents
-cooperate with insurer's investigation, settlement, and any court
proceedings
-promptly send the insurer copies of all pertinent legal papers
-submit to a physical examination if insurer requests
-submit to examination under oath and verify that your statements are true
and accurate
-authorize the insurer to obtain medical reports
-provide proof of loss if insurer requests
▶ burden of proof. Answer: this means the must prove the loss to the
insurer
▶ annual depreciation. Answer: replacement cost / expected life
▶ accumulated depreciation. Answer: annual depreciation x years used
QUESTIONS AND DETAILED SOLUTIONS
2026
▶ replacement cost. Answer: method of valuation based on cost of
replacing an item at current market prices, regardless of depreciation
▶ Functional replacement cost. Answer: pays to replace an outdated,
obsolete item with a functionally equivalent item
▶ Stated amount. Answer: property value is stated by the insured when
applying for insurance
▶ insurance policy. Answer: the legal contract b/w the insurer and the
insured
▶ cancellation and nonrenewal. Answer: insured may cancel at any time,
but the insurer is much more restricted
▶ declarations page. Answer: names of both parties
policy #
location and description of insured item
deductible
premium
,▶ first named insured. Answer: the 1st person or organization listed on the
dec page
▶ additional insured. Answer: person or org. that is added to the policy at
the request of the first named insured and benefits from policy, but is not
allowed to make changed
▶ Loss Payable Clause. Answer: lender listed as loss payee if a loss
occurs
▶ policy limits. Answer: establish the max payout value of an insurance
policy
▶ salvage. Answer: the portion or value of property that remains after a
loss
▶ abandonment clause. Answer: insured is prohibited from forcing the
insurer to take possession of damaged property for the purpose of repair or
disposal
▶ subrogation. Answer: transfer of rights that allows the insurer to recover
its losses after it has indemnified a policyholder
▶ full release settlement. Answer: all damaged paid at once
, ▶ no release settlement. Answer: signing and cashing a check substitutes
for the release form
▶ appraiser. Answer: writes damage estimates for insurance claims
▶ adjuster. Answer: investigates claims and prepares claimant statements
▶ duties of the insured after a loss. Answer: -report all accidents
-cooperate with insurer's investigation, settlement, and any court
proceedings
-promptly send the insurer copies of all pertinent legal papers
-submit to a physical examination if insurer requests
-submit to examination under oath and verify that your statements are true
and accurate
-authorize the insurer to obtain medical reports
-provide proof of loss if insurer requests
▶ burden of proof. Answer: this means the must prove the loss to the
insurer
▶ annual depreciation. Answer: replacement cost / expected life
▶ accumulated depreciation. Answer: annual depreciation x years used
