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New York Adjusters Questions and Correct
Answers (Verified Answers) Plus Rationales 2025
This is suitable for preparing for the New York Independent General Adjuster or Company Adjuster licensing exam.
- What is the minimum age requirement to become a licensed adjuster in New York? A. 18 B. 21 C. 25 D. 30 Rationale: New York requires adjusters to be at least 21 years old to apply for a license.
- Who issues adjuster licenses in New York? A. Department of Labor B. Department of Financial Services C. Department of Insurance and Banking D. State Licensing Board Rationale: In New York, the Department of Financial Services (DFS) regulates and licenses insurance professionals, including adjusters.
- What is the license term for a New York adjuster license? A. 1 year
B. 2 years C. 3 years D. 5 years Rationale: New York adjuster licenses are valid for 2 years and must be renewed biennially.
- What is the fee to apply for an adjuster license in New York (as of the latest update)? A. $ B. $ C. $ D. $ Rationale: The application fee for a New York adjuster license is currently $100.
- Which of the following types of adjuster licenses are available in New York? A. Independent only B. Independent and Public C. Company only D. Catastrophe only Rationale: New York issues licenses to Independent Adjusters and Public Adjusters.
- A New York adjuster must report a change of address within how many days? A. 60 B. 45
D. 20
Rationale: Adjusters must complete 15 hours of approved continuing education every two years. 10.A public adjuster works on behalf of: A. The insurance company B. The policyholder C. The Department of Insurance D. The reinsurer Rationale: Public adjusters represent and advocate for the policyholder, not the insurer. 11.What is the waiting period for re-taking the New York adjuster licensing exam after failing? A. 1 day B. 24 hours C. 7 days D. 30 days Rationale: Candidates can usually reschedule 24 hours after failing, depending on testing availability. 12.Which of the following perils is typically excluded from standard homeowners policies unless endorsed? A. Fire B. Flood C. Windstorm
D. Hail Rationale: Flood damage is not covered under standard homeowners policies without separate flood insurance. 13.What type of bond is required for New York public adjusters? A. Performance bond B. Surety bond C. Indemnity bond D. Fiduciary bond Rationale: Public adjusters in New York must file a surety bond to ensure compliance and integrity. 14.How much is the required surety bond for public adjusters in New York? A. $5, B. $1, C. $10, D. $2, Rationale: New York requires public adjusters to file a $1,000 surety bond. 15.An adjuster must maintain records of transactions for how long? A. 1 year B. 2 years C. 3 years D. 5 years Rationale: New York law requires adjusters to keep detailed records for 3 years.
B. New York only C. Only in northeastern states D. Canada and the U.S. Rationale: A New York license is valid only within the state unless reciprocal agreements exist. 20.Which coverage part in a commercial package policy covers property losses? A. CGL B. Workers Comp C. Commercial Property D. Inland Marine Rationale: Commercial Property coverage protects against damage or loss of business property. 21.What is subrogation in insurance? A. Premium refund B. Right to recover from third party C. Coverage suspension D. Legal waiver Rationale: Subrogation allows the insurer to seek reimbursement from third parties responsible for a loss. 22.Which of the following is considered a first-party claim? A. Insured’s claim against their own policy B. Insured sues a neighbor
C. Third party sues insured D. Insurance company sues claimant Rationale: First-party claims are filed by policyholders under their own policies. 23.Which is NOT an example of insurable interest? A. Your own car B. Your house C. Your spouse’s property D. Your neighbor’s house Rationale: You must have a financial or legal interest in the property to insure it. 24.Which of the following is a duty of the adjuster? A. Underwrite the policy B. Investigate claims C. Appoint agents D. Cancel policies Rationale: Adjusters are responsible for investigating and settling claims. 25.Which of the following would be considered an unfair claims practice? A. Denying fraudulent claims B. Misrepresenting policy provisions C. Explaining coverage limitations D. Communicating regularly with claimants Rationale: Misrepresentation of policy terms is deceptive and prohibited.
29.A liability claim involves: A. Only the insured’s damages B. A third-party claim against the insured C. The insurer’s own assets D. Workers' compensation Rationale: Liability claims are filed by third parties for damages caused by the insured. 30.A reservation of rights letter: A. Informs the insured that coverage might be denied B. Denies the claim C. Pays the full claim D. Cancels the policy Rationale: This letter protects the insurer’s right to deny a claim after further investigation. 31.What is a deductible in an insurance policy? A. A penalty B. An amount the insured pays before insurance applies C. A late fee D. A tax Rationale: A deductible is the amount the policyholder is responsible for before the insurer pays. 32.Which of the following is an example of replacement cost coverage? A. Paying current market value B. Paying full cost to replace damaged property with no depreciation
C. Paying depreciated value D. Paying book value Rationale: Replacement cost provides reimbursement without subtracting for depreciation. 33.What is the primary purpose of the appraisal clause in a property policy? A. Resolve disputes over value of loss B. Cancel the policy C. Raise premiums D. Adjust coverage limits Rationale: The appraisal clause helps settle disagreements about the amount of a covered loss. 34.In the event of a large loss, when might a “proof of loss” be required? A. Never B. When requested by the insurer C. Always within 30 days D. Only in small claims Rationale: The insurer may request a signed, sworn statement of proof of loss when needed. 35.An adjuster who handles claims dishonestly can face: A. Higher commissions B. License suspension or revocation C. More business D. Lower CE requirements
39.An insurer’s duty to defend a claim is: A. Broader than its duty to indemnify B. The same as paying a claim C. Based on the policyholder’s net worth D. Only after judgment Rationale: Insurers must often defend claims even if they ultimately don’t have to pay them. 40.Which of the following is an example of a moral hazard? A. Living near a river B. Poor building maintenance C. Owning an old roof D. Submitting a false claim Rationale: Moral hazards involve dishonesty or intent to defraud, like filing false claims. 41.What does proximate cause refer to? A. The primary cause of the loss B. The location of the incident C. The value of the claim D. The payment schedule Rationale: Proximate cause is the event that leads directly to the loss without interruption. 42.In claims adjusting, mitigation refers to: A. Causing more damage
B. Taking steps to reduce loss C. Arguing the claim D. Canceling the claim Rationale: The insured has a duty to mitigate (reduce) further damage after a loss. 43.When does a New York adjuster license expire? A. Every year on January 1 B. December 31 annually C. Two years from issue date D. After five years Rationale: The license is valid for two years from the date of issuance. 44.Which of the following is true about salvage rights? A. They apply only to auto insurance B. The insurer can recover value from damaged property C. They allow denial of all claims D. They transfer ownership to the claimant Rationale: Salvage rights allow the insurer to retain damaged property with residual value. 45.Which law governs unfair claims settlement practices in New York? A. Common Law B. New York Insurance Law Section 2601 C. The FTC Act D. The Civil Procedures Code
Rationale: Denial of claims must be provided in writing with a valid reason. 49.What is the purpose of coinsurance in a commercial property policy? A. Encourage insureds to carry adequate coverage B. Waive deductibles C. Lower premiums automatically D. Transfer liability Rationale: Coinsurance clauses require the insured to carry a percentage of coverage relative to value to avoid penalties. 50.An adjuster working a catastrophe under a temporary permit may operate for: A. 30 days B. 90 days C. 120 days D. 365 days Rationale: New York grants emergency adjuster permits for up to 120 days in catastrophic events. 51.In a homeowners policy, which peril is typically covered under the basic form (HO-1)? A. Earthquake B. Fire C. Flood D. Nuclear hazard
Rationale: Fire is one of the named perils covered under the HO-1 basic homeowners form. 52.A person who negotiates insurance contracts on behalf of an insurer is a(n): A. Adjuster B. Agent C. Broker D. Underwriter Rationale: Agents represent the insurer and can bind coverage. 53.Which of the following must be disclosed to a claimant during the claims process? A. The adjuster's income B. The policyholder’s driving record C. Applicable policy coverages D. Company marketing strategies Rationale: Claimants must be informed of coverages that may apply to their loss. 54.The purpose of a reservation of rights letter is to: A. Notify that coverage may be denied B. Approve payment C. Cancel the policy D. Change coverage Rationale: A reservation of rights letter protects the insurer’s right to later deny a claim.
C. Any type of interest D. None of the above Rationale: Insurable interest exists when a person stands to suffer financial loss from damage. 59.What is a sworn proof of loss? A. A formal statement detailing the loss B. A type of policy endorsement C. An agreement between insurers D. A coverage exclusion Rationale: Proof of loss is a sworn statement submitted to the insurer verifying the details of a claim. 60.When is it appropriate to deny a claim based on misrepresentation? A. If it was accidental B. If it was material to the risk C. If the claim is small D. Always Rationale: A material misrepresentation that affects underwriting decisions can void coverage. 61.Which part of a liability policy describes who is covered and for what acts? A. Definitions B. Declarations C. Insuring agreement D. Exclusions
Rationale: The insuring agreement outlines the scope of coverage provided under the policy. 62.What is the standard of proof in a civil insurance claim? A. Preponderance of the evidence B. Beyond a reasonable doubt C. Probable cause D. Clear and convincing Rationale: Civil cases, including insurance claims, follow the preponderance of evidence standard. 63.What is the purpose of the “other insurance” clause? A. Prevent double recovery B. Increase policy limits C. Provide umbrella coverage D. Guarantee total payment Rationale: It limits how much will be paid if more than one policy applies. 64.Which of the following is NOT required for a valid contract? A. Offer B. Consideration C. Acceptance D. Witness Rationale: A witness is not a legal requirement for a valid insurance contract. 65.Which term describes a loss caused by continuous exposure over time? A. Occurrence
