1
Florida Adjusters License Exam Questions with Answers
(100% Correct Answers)
When Sally applies for an auto policy, her agent issues her a ________ so that she can
benefit from insurance protection while he underwrites the policy. —ANS: Binder
When an insurer buys insurance to reduce its exposure to loss, this is called —ANS:
Reinsurance
Reinsurance —ANS: insurance for insurers; it helps reduce their exposure to losses
Emma is found guilty of arson causing 175,000 in damages to her home, which still has
155,000 left on her mortgage at the time of the fire. Under her mortgage clause, Emma's
mortgage lender can recoup: —ANS: 155,000 of insurable interests - the amount left
outstanding on the loan
An "occurrence" is defined as: —ANS: an unexpected event that causes loss.
© 2025 All rights reserved
,2
Replacement Cost Value: —ANS: Under replacement cost valuation, insurers may
safeguard the principle of indemnity by requiring policy holders to replace insured
items before making full reparations
Cindy holds an insurance policy from Sine Nomine Insurance. This is not a publicly
traded company, and Cindy can participate in the election of the board, receiving
dividends if the company does well. Sine Nomine Insurance could be best described as
a: —ANS: Mutual Insurance Company
Loss of Money invested in the stock market is a —ANS: speculative risk
When taking recorded witness statements, the adjuster should —ANS: Remain
Objective
Coinsurance Policy —ANS: requires you to have a minimum of 80% minimum, if you
do not comply there is a penalty
Coinsurance Penalty Formula —ANS: dividing the amount of coverage one should
have by how much they do have.
EX: they should have 80% (96,000) , they do have (40,000). 40,000/96,000= 41.67%
© 2025 All rights reserved
,3
then apply that to the perceived cost of indemnity before the penalty.
12,000 x 41.67% = 5,000
They will receive 5,000 dollars
Standard Fire Policy Pays —ANS: Actual Cash Value
Stan built a porch for his home three years ago at a cost of $10,000. The value of the
porch has depreciated by $6,000, and it would cost $12,000 to replace it today. After
Stan's porch burnt down during a BBQ today, how much would a Standard Fire Policy
indemnify Stan for his porch? —ANS: 12,000 - 6,000 = 6,000
he will receive 6,000 because standard fire pays actual cash value
John moved out of his home 3 months ago and put it up for sale. While waiting for it to
sell, the pipes burst and damage the floors due to freezing.
This is not covered —ANS: freezing is a covered peril but is excluded if the building is
vacant and the insured has not taken responsible care to maintain heat or shut off the
water supply
© 2025 All rights reserved
, 4
DP-2 Broad Form covers what under the peril of theft? —ANS: Broken windows
caused by the burglar breaking in
Which of the following is covered under a DP-3
a. earthquake
b. flood
c. water backup from sewers
4. Power failure on premises —ANS: Power failure on-premises
In a dwelling policies, coverage D pays for —ANS: Lost Rental Income
If a Florida HO policy has been in effect for fewer than 90 days For nonpayment-
related cancelation the insurer must notify the policyholder at least: —ANS: 10 days
before cancelling
If a Florida HO policy has been in effect for fewer than 90 days for any other approved
reason the policy holder must be notified at least —ANS: 20 days before cancelling
The coverage for damage to personal property off-premises is limited to 10% of
coverage c's limit in a DP-2 policy. —ANS: coverage c is 25,000 x 10% = 2,500
© 2025 All rights reserved
Florida Adjusters License Exam Questions with Answers
(100% Correct Answers)
When Sally applies for an auto policy, her agent issues her a ________ so that she can
benefit from insurance protection while he underwrites the policy. —ANS: Binder
When an insurer buys insurance to reduce its exposure to loss, this is called —ANS:
Reinsurance
Reinsurance —ANS: insurance for insurers; it helps reduce their exposure to losses
Emma is found guilty of arson causing 175,000 in damages to her home, which still has
155,000 left on her mortgage at the time of the fire. Under her mortgage clause, Emma's
mortgage lender can recoup: —ANS: 155,000 of insurable interests - the amount left
outstanding on the loan
An "occurrence" is defined as: —ANS: an unexpected event that causes loss.
© 2025 All rights reserved
,2
Replacement Cost Value: —ANS: Under replacement cost valuation, insurers may
safeguard the principle of indemnity by requiring policy holders to replace insured
items before making full reparations
Cindy holds an insurance policy from Sine Nomine Insurance. This is not a publicly
traded company, and Cindy can participate in the election of the board, receiving
dividends if the company does well. Sine Nomine Insurance could be best described as
a: —ANS: Mutual Insurance Company
Loss of Money invested in the stock market is a —ANS: speculative risk
When taking recorded witness statements, the adjuster should —ANS: Remain
Objective
Coinsurance Policy —ANS: requires you to have a minimum of 80% minimum, if you
do not comply there is a penalty
Coinsurance Penalty Formula —ANS: dividing the amount of coverage one should
have by how much they do have.
EX: they should have 80% (96,000) , they do have (40,000). 40,000/96,000= 41.67%
© 2025 All rights reserved
,3
then apply that to the perceived cost of indemnity before the penalty.
12,000 x 41.67% = 5,000
They will receive 5,000 dollars
Standard Fire Policy Pays —ANS: Actual Cash Value
Stan built a porch for his home three years ago at a cost of $10,000. The value of the
porch has depreciated by $6,000, and it would cost $12,000 to replace it today. After
Stan's porch burnt down during a BBQ today, how much would a Standard Fire Policy
indemnify Stan for his porch? —ANS: 12,000 - 6,000 = 6,000
he will receive 6,000 because standard fire pays actual cash value
John moved out of his home 3 months ago and put it up for sale. While waiting for it to
sell, the pipes burst and damage the floors due to freezing.
This is not covered —ANS: freezing is a covered peril but is excluded if the building is
vacant and the insured has not taken responsible care to maintain heat or shut off the
water supply
© 2025 All rights reserved
, 4
DP-2 Broad Form covers what under the peril of theft? —ANS: Broken windows
caused by the burglar breaking in
Which of the following is covered under a DP-3
a. earthquake
b. flood
c. water backup from sewers
4. Power failure on premises —ANS: Power failure on-premises
In a dwelling policies, coverage D pays for —ANS: Lost Rental Income
If a Florida HO policy has been in effect for fewer than 90 days For nonpayment-
related cancelation the insurer must notify the policyholder at least: —ANS: 10 days
before cancelling
If a Florida HO policy has been in effect for fewer than 90 days for any other approved
reason the policy holder must be notified at least —ANS: 20 days before cancelling
The coverage for damage to personal property off-premises is limited to 10% of
coverage c's limit in a DP-2 policy. —ANS: coverage c is 25,000 x 10% = 2,500
© 2025 All rights reserved
