Free P&C Adjuster with Workers Compensation Practice Questions

Sample Practice Questions

Try these 10 sample questions from the P&C Adjuster with Workers Compensation practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

1. 1An insurer adds many comparable homes to a pool and estimates its annual claim cost. Which principle explains why the pool's total losses become more predictable?

   1. A. Coinsurance
   2. B. Indemnity
   3. C. Law of large numbers
   4. D. Subrogation

   Answer: C

   Explanation: "there is greater certainty about the total losses" Pooling more comparable exposures reduces uncertainty in aggregate loss estimates; the other terms govern underinsurance, compensation, and recovery from third parties.

   Reference: A Regulator's Introduction to the Insurance Industry — Important Insurance Concepts, p. 7

2. 2A landlord wants the Basic Form dwelling policy that lists fire, lightning, and windstorm among its specified perils for the dwelling and attached structures. Which form is that?

   1. A. DP-1
   2. B. DP-2
   3. C. DP-3
   4. D. HO-7

   Answer: A

   Explanation: "DP-1 (Basic Form) – Covers the dwelling structure and attached structures against specific named perils like fire, lightning, and windstorm." This is the named Basic Form described; DP-2 adds broader named perils, DP-3 is special form, and HO-7 is for manufactured homes.

   Reference: NAIC Homeowners Market Data Call Definitions — Dwelling and Homeowners Policy Forms, pp. 1-2

3. 3A compensable Mississippi injury combines with a preexisting condition that materially contributes to the resulting disability. What adjustment does the apportionment rule require?

   1. A. Reduce benefits in proportion to the preexisting condition's contribution
   2. B. Reduce benefits by one-half regardless of medical evidence
   3. C. Defer all benefits until the preexisting condition resolves
   4. D. Pay only medical benefits and deny indemnity benefits

   Answer: A

   Explanation: Mississippi apportions compensation when a preexisting condition is a material contributing factor, reducing benefits by the proportion attributable to that condition. Official text: "shall be reduced by that proportion"

   Reference: Ms Legislature Sb 2576 Conference — Miss. Code Ann. Section 71-3-7, Apportionment

4. 4A contractor investigates property losses on behalf of an insurer in Mississippi. Which statutory role describes that work?

   1. A. Adjuster
   2. B. Insurance producer
   3. C. Risk manager
   4. D. Premium auditor

   Answer: A

   Explanation: Section 83-17-401 defines an adjuster to include a person who investigates or adjusts losses for an insurer or self-insured. Official text: "investigates or adjusts losses on behalf of either an insurer or a self-insured"

   Reference: HB1174 (As Introduced) - 2025 Regular Session — Miss. Code Ann. Section 83-17-401(a)

5. 5Except for the statutory nonpayment rule, how much advance notice does Mississippi require before canceling a covered property policy?

   1. A. 10 days
   2. B. 20 days
   3. C. 30 days
   4. D. 60 days

   Answer: C

   Explanation: Section 83-5-28 generally requires 30 days' notice before cancellation, reduction in coverage, or nonrenewal of the covered policy types. Official text: "at least thirty (30) days' advance notice"

   Reference: Ms Legislature Sb 2311 Sent Governor — Miss. Code Ann. Section 83-11-7

6. 6One person is injured in a Mississippi motor-vehicle accident. What is the minimum bodily-injury liability amount for that person?

   1. A. $15,000 per person
   2. B. $20,000 per person
   3. C. $25,000 per person
   4. D. $50,000 per person

   Answer: C

   Explanation: The Mississippi Insurance Department states the minimum limit as $25,000 for bodily injury to one person. Official text: "$25,000 per person (limited to a single accident)"

   Reference: Auto Insurance - Official Website of the Mississippi Insurance Department — Miss. Code Ann. Section 63-15-3; Minimum Automobile Insurance Requirements

7. 7A fire damages a leased warehouse. Which person has an insurable interest in the warehouse building itself because the damage can cause that person a direct financial loss?

   1. A. A lender with a mortgage on the damaged warehouse
   2. B. A lender with a mortgage on a different warehouse
   3. C. A supplier already paid for its warehouse deliveries
   4. D. A buyer who has not contracted to purchase the building

   Answer: A

   Explanation: "the insured can suffer a financial loss from damage, loss or destruction" The lender's security in this damaged warehouse can lose value. The other parties have no current financial interest in this particular building.

   Reference: NAIC Glossary of Insurance Terms — Glossary entry

8. 8A visitor is injured at a homeowner's house, and the homeowner is found legally responsible. Which homeowners coverage addresses the visitor's damages?

   1. A. Coverage for the home's physical structure
   2. B. Coverage for the homeowner's personal liability
   3. C. Coverage for additional living expenses
   4. D. Coverage for the homeowner's possessions

   Answer: B

   Explanation: "Covers financial losses from property damage and personal injuries to others, if found legally responsible." Personal liability addresses damages owed to others because of legal responsibility; the other coverages address the insured's own property or living expenses.

   Reference: NAIC Homeowners Insurance — Understanding Homeowners Insurance, Coverage Types

9. 9When applying Mississippi apportionment, must the preexisting condition itself have been occupationally disabling before the work injury?

   1. A. Yes, in every claim
   2. B. Yes, but only for permanent disability
   3. C. No, occupational disability is not required
   4. D. No, but only if the condition was work-related

   Answer: C

   Explanation: The Mississippi rule states that the preexisting condition need not have been occupationally disabling before the compensable injury. Official text: "The preexisting condition does not have to be occupationally disabling for this apportionment to apply."

   Reference: Ms Legislature Sb 2576 Conference — Miss. Code Ann. Section 71-3-7, Apportionment

10. 10A Mississippi employee supervises other personnel who handle contested insurance claims. How is that supervisory function classified?

    1. A. Adjuster activity
    2. B. Producer appointment activity
    3. C. Rate-making activity
    4. D. Premium-finance activity

    Answer: A

    Explanation: The statutory adjuster definition expressly includes a person who supervises the handling of claims. Official text: "any person who supervises the handling of claims"

    Reference: HB1174 (As Introduced) - 2025 Regular Session — Miss. Code Ann. Section 83-17-401(a)