Free Tennessee Public Adjuster Practice Exam

1. Which statement about loss reserves is accurate?
A reserve is the insurer's opening settlement offer on the claimA reserve is published to the insured with the acknowledgment letterA reserve is an admission that the reported loss is covered by the policyA reserve is an internal figure that governs the handling adjuster's authority
2. A contract in which only the insurer makes an enforceable promise is
ExecutoryAleatoryBilateralUnilateral
3. A building's replacement cost is $500,000 and the policy carries an 80% coinsurance clause, but the insured bought only $300,000 of coverage. A fire causes an $80,000 loss; the deductible is $1,000. How much does the carrier pay?
$59,000$79,000$60,000$47,000
4. Mediation of a claim dispute is best described as:
A regulator's review of the insurer's handling of the claim fileA hearing before a neutral who issues a decision binding both sidesA facilitated negotiation before a neutral with no power to decideA valuation conducted by two appraisers and a neutral umpire
5. Before an adjuster takes a recorded statement, the subject is entitled to:
Know who is recording and why, and to consent to the recordingA written list of the questions that the adjuster intends to askA copy of the insurer's claim file as it stands on that dateThe presence of the insurer's counsel throughout the interview
6. The policy process used when the parties disagree only on the amount of loss is
MediationAppraisalSubrogationArbitration
7. Depreciation held back until repairs are completed is
Salvage valueBettermentRecoverable depreciationNonrecoverable depreciation
8. Critical evidence in a property investigation means:
The records generated by public authorities about the incidentThe statements taken from the insured and from any witnessesThe documents that establish the insured's ownership and interestThe physical proof of cause and origin found at the loss site
9. An adjuster deployed to a widespread disaster area is a
Desk adjusterPublic adjusterCatastrophe adjusterStaff examiner
10. In the fixed order of a coverage analysis, the question whether an exclusion applies is reached:
After confirming covered property, a covered location, and a covered perilBefore determining whether the claimant is an insured under the policyAfter applying the deductible and the valuation and limits provisionsBefore deciding whether the policy was in force on the date of the loss
11. A process where a neutral hears both sides and issues a decision is
AppraisalArbitrationMediationNegotiation
12. An insured pays a $1,200 annual premium and later collects a $150,000 fire loss payment. Another insured pays premiums for 20 years and collects nothing. This unequal exchange dependent on an uncertain event illustrates which contract characteristic?
AdhesiveAleatoryConditionalUnilateral
13. An appraisal award fixes the amount of a fire loss. The insurer had reserved its rights on a misrepresentation defense. The award:
Extinguishes the reserved defense, because the amount is now bindingFixes the amount only; the reserved coverage defense survives the awardRequires payment before any reserved coverage defense may be raisedConverts the coverage dispute into a question for the umpire to decide
14. A claim was closed on incomplete information. Which fact most strongly determines whether it can be reopened by supplement?
Whether the insured signed a full release when the claim was settledWhether the insured has already received the withheld depreciationWhether the estimate was written by a staff or an independent adjusterWhether the carrier's file has been transferred to a different adjuster
15. The lesson contrasts property insurance with life insurance on the timing of insurable interest. For LIFE insurance, insurable interest must exist:
Both at inception and at deathAt any point during the policy periodAt the time of death onlyAt policy inception
16. In a coverage dispute, which party bears the burden of proving that an exclusion applies?
The insuredThe insurerWhichever party filed suit firstThe party who demanded appraisal
17. The "legal purpose" element of a valid insurance contract, together with the insurable-interest requirement, mainly serves to:
Require every issued policy to be countersigned by a licensed resident agentGuarantee the insured a modest profit on every covered total loss they sufferAllow the insurer to cancel coverage for virtually any reason after a loss occursKeep insurance from operating as a wagering contract on an unlawful or non-existent stake
18. The federal agency that runs the National Flood Insurance Program is
HUDSBAFEMANAIC
19. The guideline defining what may be written as inland marine is the
Nationwide Marine DefinitionInland Marine GuideMarine Insurance ActCommercial Lines Manual
20. Which of the following losses offers the carrier a realistic subrogation opportunity after it pays the insured?
A lightning strike that destroys electronicsShingles blown off by a windstormRoof damage from a hailstormA fire caused by a defective appliance