CA ADJUSTERS 2025/2026 QUESTIONS AND ANSWERS
GRADED A+
✔✔The "when more than one coverage applies" condition in crime insurance is
designed to:
Answer Choices: Select the Correct Answer
Specifies how a claim would be allocated among the different insurers.
Allow the insured to choose the company that will pay the claim.
Provide for subrogation of a claim.
Avoid overpayment of a claim. - ✔✔Specifies how a claim would be allocated among
the different insurers. is correct.
EXPLANATION:
The purpose of the clause is to specify how a claim would be allocated among the
different insurers.
✔✔A large tree has fallen into Paul's yard caused by wind. The claims service
representative advises Paul to call a contractor to remove the tree and send the
insurance company the bill. The bill is $1,200. However, the policy coverage for the
debris removal of a tree that has fallen by wind is only $500 unless the tree hits the
house, which was not the case. What should the adjuster do?
Answer Choices: Select the Correct Answer
Pay only $500
Pay the $1,200
Explain the policy provisions and ask to insured to reimburse the insurer for the
difference
Negotiate - ✔✔Pay the $1,200 is correct.
EXPLANATION:
The consumer relied on the statements of the claims representative so the insurance
company would be estopped from denying the claim. The insurer had already waived its
right to deny full payment of the claim because of the statements of the claims
representative. Therefore, the $1,200 should be paid.
✔✔Under the commercial general liability policy, medical payment expenses must be:
Answer Choices: Select the Correct Answer
Reported within one year of the accident.
Paid within one year of the accident.
Reported within two year of the accident.
Paid within three years of the accident - ✔✔Reported within one year of the accident. is
correct.
EXPLANATION:
It is required in the policy that the expenses are incurred and reported to the insurer
within one (1) year of the date of the accident.
✔✔Which of the following perils are covered under Section I of the homeowners form?
Answer Choices: Select the Correct Answer
,Physical injury to a guest hurt on the residence premises
First Aid expenses
Theft of credit or funds transfer cards
Intentional damage to the property of others - ✔✔The correct answer is: Theft of credit
or funds transfer cards.
EXPLANATION:
Section I coverages are the property coverages. Section II provides liability and medical
payments coverage. The theft of the credit or funds transfer cards are covered property
up to a limit of $500.
✔✔John Smith has just made his last car payment which concludes his contract. The
finance company, for reasons not immediately apparent, has the car repossessed. If Mr.
Smith brings a suit, the court will allow Mr. Smith to retake possession of the car
pending the court's final ruling as to ownership if Mr. Smith provides the court a:
Answer Choices: Select the Correct Answer
Attachment bond.
Indemnity bond.
Performance bond.
Replevin bond. - ✔✔The correct answer is: Replevin bond..
EXPLANATION:
A replevin bond guarantees that if property is in the possession of party A is determined
to belong to party B and the court orders its return to party B, party A will do so. Party A
would first have to obtain an attachment bond, also required by the court, in case the
property was wrongfully repossessed.
✔✔For how long must an adjusting firm maintain its claim files?
Answer Choices: Select the Correct Answer
For as long as any statute of limitations
For the current year and 10 prior years
For the current year and 4 prior years
For the current year only - ✔✔For the current year and 4 prior years is correct.
EXPLANATION:
Per the California DOI, adjusting firms must maintain files for the current policy year and
the preceding four years, at the company's principal place of business.
✔✔The focus of the Equipment Breakdown coverage is:
Answer Choices: Select the Correct Answer
Prevention of loss
Protection from loss
To provide extra coverage over the property policy
To reinforce the explosion and fire perils - ✔✔The correct answer is: Prevention of loss.
EXPLANATION:
The main focus of this coverage is to prevent loss rather then protection from loss.
Proper maintenance of the equipment is required and inspections will be performed to
help prevent losses.
, ✔✔How are crop insurance premiums calculated?
Answer Choices: Select the Correct Answer
Number of fields
Number of crops
Number of acres
Per farm - ✔✔Number of acres is correct.
EXPLANATION:
Crop insurance is based on acreage for each crop.
✔✔Which of the following is not an implied warranty under an ocean marine policy?
Answer Choices: Select the Correct Answer
Seaworthiness of the vessel
Legality
No deviation in the voyage
Protection and indemnity - ✔✔Protection and indemnity is correct.
EXPLANATION:
Protection and indemnity is a form of ocean marine liability coverage and is not an
implied warranty.
✔✔In California a lawsuit for bodily injury must be brought within:
Answer Choices: Select the Correct Answer
Five years from the date of the loss
180 days from the date of the loss
Two years from the date of the loss
Three years from the date of the loss - ✔✔Two years from the date of the loss is
correct.
EXPLANATION:
The lawsuit must be brought within two years of the date of the loss.
✔✔A business owner who is careless about property left in his care may be guilty of
which of the following hazards:
Answer Choices: Select the Correct Answer
Morale.
Moral.
Catastrophic.
Occupational. - ✔✔Morale. is correct.
EXPLANATION:
A morale hazard is one created by carelessness or indifference, the failure to exercise
due care. A moral hazard is one deliberately created by an insured party willing to trade
a loss for a claim payment.
✔✔With an Equipment Breakdown policy, the loss settlement is:
Answer Choices: Select the Correct Answer
ACV all of the time
GRADED A+
✔✔The "when more than one coverage applies" condition in crime insurance is
designed to:
Answer Choices: Select the Correct Answer
Specifies how a claim would be allocated among the different insurers.
Allow the insured to choose the company that will pay the claim.
Provide for subrogation of a claim.
Avoid overpayment of a claim. - ✔✔Specifies how a claim would be allocated among
the different insurers. is correct.
EXPLANATION:
The purpose of the clause is to specify how a claim would be allocated among the
different insurers.
✔✔A large tree has fallen into Paul's yard caused by wind. The claims service
representative advises Paul to call a contractor to remove the tree and send the
insurance company the bill. The bill is $1,200. However, the policy coverage for the
debris removal of a tree that has fallen by wind is only $500 unless the tree hits the
house, which was not the case. What should the adjuster do?
Answer Choices: Select the Correct Answer
Pay only $500
Pay the $1,200
Explain the policy provisions and ask to insured to reimburse the insurer for the
difference
Negotiate - ✔✔Pay the $1,200 is correct.
EXPLANATION:
The consumer relied on the statements of the claims representative so the insurance
company would be estopped from denying the claim. The insurer had already waived its
right to deny full payment of the claim because of the statements of the claims
representative. Therefore, the $1,200 should be paid.
✔✔Under the commercial general liability policy, medical payment expenses must be:
Answer Choices: Select the Correct Answer
Reported within one year of the accident.
Paid within one year of the accident.
Reported within two year of the accident.
Paid within three years of the accident - ✔✔Reported within one year of the accident. is
correct.
EXPLANATION:
It is required in the policy that the expenses are incurred and reported to the insurer
within one (1) year of the date of the accident.
✔✔Which of the following perils are covered under Section I of the homeowners form?
Answer Choices: Select the Correct Answer
,Physical injury to a guest hurt on the residence premises
First Aid expenses
Theft of credit or funds transfer cards
Intentional damage to the property of others - ✔✔The correct answer is: Theft of credit
or funds transfer cards.
EXPLANATION:
Section I coverages are the property coverages. Section II provides liability and medical
payments coverage. The theft of the credit or funds transfer cards are covered property
up to a limit of $500.
✔✔John Smith has just made his last car payment which concludes his contract. The
finance company, for reasons not immediately apparent, has the car repossessed. If Mr.
Smith brings a suit, the court will allow Mr. Smith to retake possession of the car
pending the court's final ruling as to ownership if Mr. Smith provides the court a:
Answer Choices: Select the Correct Answer
Attachment bond.
Indemnity bond.
Performance bond.
Replevin bond. - ✔✔The correct answer is: Replevin bond..
EXPLANATION:
A replevin bond guarantees that if property is in the possession of party A is determined
to belong to party B and the court orders its return to party B, party A will do so. Party A
would first have to obtain an attachment bond, also required by the court, in case the
property was wrongfully repossessed.
✔✔For how long must an adjusting firm maintain its claim files?
Answer Choices: Select the Correct Answer
For as long as any statute of limitations
For the current year and 10 prior years
For the current year and 4 prior years
For the current year only - ✔✔For the current year and 4 prior years is correct.
EXPLANATION:
Per the California DOI, adjusting firms must maintain files for the current policy year and
the preceding four years, at the company's principal place of business.
✔✔The focus of the Equipment Breakdown coverage is:
Answer Choices: Select the Correct Answer
Prevention of loss
Protection from loss
To provide extra coverage over the property policy
To reinforce the explosion and fire perils - ✔✔The correct answer is: Prevention of loss.
EXPLANATION:
The main focus of this coverage is to prevent loss rather then protection from loss.
Proper maintenance of the equipment is required and inspections will be performed to
help prevent losses.
, ✔✔How are crop insurance premiums calculated?
Answer Choices: Select the Correct Answer
Number of fields
Number of crops
Number of acres
Per farm - ✔✔Number of acres is correct.
EXPLANATION:
Crop insurance is based on acreage for each crop.
✔✔Which of the following is not an implied warranty under an ocean marine policy?
Answer Choices: Select the Correct Answer
Seaworthiness of the vessel
Legality
No deviation in the voyage
Protection and indemnity - ✔✔Protection and indemnity is correct.
EXPLANATION:
Protection and indemnity is a form of ocean marine liability coverage and is not an
implied warranty.
✔✔In California a lawsuit for bodily injury must be brought within:
Answer Choices: Select the Correct Answer
Five years from the date of the loss
180 days from the date of the loss
Two years from the date of the loss
Three years from the date of the loss - ✔✔Two years from the date of the loss is
correct.
EXPLANATION:
The lawsuit must be brought within two years of the date of the loss.
✔✔A business owner who is careless about property left in his care may be guilty of
which of the following hazards:
Answer Choices: Select the Correct Answer
Morale.
Moral.
Catastrophic.
Occupational. - ✔✔Morale. is correct.
EXPLANATION:
A morale hazard is one created by carelessness or indifference, the failure to exercise
due care. A moral hazard is one deliberately created by an insured party willing to trade
a loss for a claim payment.
✔✔With an Equipment Breakdown policy, the loss settlement is:
Answer Choices: Select the Correct Answer
ACV all of the time
