Claims Adjuster Test State Laws and Regulations Questions and Answers

Question 1

In a state that follows the "comparative negligence" doctrine, a claimant is found to be 20% at fault for an accident that caused them $100,000 in damages. How will this assessment of fault typically affect the claimant's recovery?

Accepted Answer

The claimant's recovery will be reduced by 20% to $80,000.

Answer

Under comparative negligence, a claimant's recovery is reduced by their percentage of fault. In this case, 20% of the $100,000 in damages is $20,000, so the claimant's recovery is reduced to $80,000. The harsh doctrine of contributory negligence, used in only a few states, would bar any recovery if the claimant is even 1% at fault.

Question 2

Most states have adopted a version of the NAIC's Unfair Claims Settlement Practices Act. Which of the following is considered an unfair claims practice under this model act?

Accepted Answer

Failing to acknowledge pertinent communications regarding a claim with reasonable promptness.

Answer

The NAIC's Model Unfair Claims Settlement Practices Act specifically lists 'Failing to acknowledge with reasonable promptness pertinent communications with respect to claims' as an unfair practice. The other options describe standard, acceptable practices in the claims handling process.

Question 3

An adjuster working for an insurance company is sent to evaluate a policyholder's property damage claim. This adjuster is not a salaried employee of the insurer but is contracted for this specific assignment. What type of adjuster is this?

Accepted Answer

Independent Adjuster

Answer

An Independent Adjuster is contracted by an insurance company to investigate claims on its behalf. Unlike a staff adjuster (direct employee) or a public adjuster (hired by the policyholder), their loyalty lies with the insurer that hired them.

Question 4

A vehicle has been damaged to the extent that the insurer declares it a total loss and takes possession of it after paying the claim. State law requires the vehicle's title to be changed to reflect this status. What is this new title typically called?

Accepted Answer

Salvage Title

Answer

When an insurer declares a vehicle a total loss and takes possession, the title must be branded as a 'Salvage Title'. This indicates the vehicle has sustained significant damage. A 'Rebuilt Title' is issued only after a salvage vehicle has been repaired and passed a state inspection.

Question 5

Most states require licensed insurance adjusters to complete a specific number of continuing education (CE) hours to maintain their license. What is the most common biennial (two-year) requirement for CE hours?

Accepted Answer

24 hours, with 3 hours in ethics

Answer

While requirements vary by state, the most typical standard is 24 hours of continuing education every two years, which includes a specific number of hours (often 3) dedicated to ethics.

Claims Adjuster Test Practice Test

Claims Adjuster Test Practice Test

Claims Adjuster Test State Laws and Regulations Questions and Answers