Free Insurance Licensing NY-Independent-General-Adjuster Practice Exam with Questions & Answers

The correct answer is D — Personal Property Replacement Cost. Under standard homeowners loss-settlement principles, personal property is commonly settled initially on an actual cash value (ACV) basis unless replacement-cost treatment is provided by the policy or an endorsement. ACV normally reflects depreciation, whereas replacement cost measures the amount required to replace damaged property with property of like kind and quality without deducting depreciation, subject to the policy's conditions and limitations.

The Personal Property Replacement Cost endorsement, HO 04 90, modifies the homeowners contract so qualifying Coverage C personal property may be settled on a replacement-cost basis instead of ordinary ACV treatment. The official Series 17-70 content outline specifically identifies Personal Property Replacement Cost (HO 04 90) as a selected homeowners endorsement and separately tests ACV and replacement-cost valuation.

Inflation guard principally adjusts coverage limits to reflect increasing construction costs; it does not itself convert contents from ACV to replacement cost. “Other insurance” governs coordination when multiple policies apply. Increased cost of construction typically addresses additional building costs generated by enforcement of ordinances or laws rather than depreciation on personal property.

New York DFS distinguishes replacement cost from ACV by noting that replacement-cost settlement does not deduct depreciation.

Therefore, D is correct.

The correct answer is B. The National Flood Insurance Program is designed principally to insure eligible buildings and personal property against direct physical loss by or from flood. The Standard Flood Insurance Policy does not function as broad consequential-loss insurance. Federal policy language expressly distinguishes direct physical flood damage from indirect economic consequences such as loss of use, lost revenue, lost profits, business interruption, and additional living expenses. Therefore, option A and option C do not describe the fundamental NFIP coverage grant.

Option D is also incorrect as a general statement. Sewer or drain backup is not independently treated as a covered flood merely because water enters through a sewer or drain; coverage depends on whether the backup is directly caused by an insured flood meeting the federal policy definition and conditions.

Option B uses simplified exam wording. Technically, NFIP does not cover literally every direct loss without limitation; coverage remains subject to insured-property requirements, exclusions, limits, and deductibles. Nevertheless, B accurately states the intended coverage principle. The official Series 17-70 outline specifically includes National Flood Insurance Program—eligibility, coverage, flood definition, limits, deductibles, proof of loss, and policy forms.

The correct answer is A. Aircraft Medical Payments coverage pays specified medical expenses resulting from bodily injury sustained in connection with a covered aircraft accident, generally without requiring the injured person first to establish negligence against the aircraft owner or operator.

AOPA's aviation-insurance guidance specifically states that aircraft Medical Payments coverage includes expenses such as ambulance, surgical, dental, and professional nursing services. It can also apply to injuries occurring while a person is entering or leaving the aircraft, subject to the policy's limits and conditions.

This protection is distinct from bodily injury liability coverage. Liability insurance responds when an insured is legally responsible for another person's bodily injury, whereas Medical Payments is designed to fund qualifying medical expenses on a limited no-fault basis.

Option B is incorrect because a deductible is the portion of a covered loss retained by the insured rather than a benefit paying medical expenses. Option C refers to the consideration paid for insurance coverage. Option D, fiduciary liability, protects against specified breaches of fiduciary duty and has no relationship to ambulance transportation following an aircraft accident.

The Series 17-70 curriculum includes specialized aviation insurance concepts together with medical-payment and liability distinctions.

Therefore, ambulance charges are properly classified under Medical Payments, making A correct.

The correct examination answer is B — $100,000. A standard Dwelling Policy primarily provides property insurance; personal liability protection is added through the Personal Liability Supplement. Under that supplement, Coverage L — Personal Liability responds when an insured becomes legally liable for bodily injury or property damage caused by a covered occurrence. Coverage M separately provides Medical Payments to Others. The Series 17-70 outline expressly identifies the Personal Liability Supplement as a tested Dwelling Policy endorsement.

The traditional standard limit associated with Coverage L in licensing material is $100,000 per occurrence. Policy analyses of the ISO dwelling liability supplement also illustrate Coverage L using a $100,000 limit.

A technical distinction is important for claims practice: the actual contractual limit is ultimately the amount shown in the policy declarations or Personal Liability Schedule. Therefore, higher limits may be purchased when offered by the insurer. The question is testing the standard/default licensing-exam limit rather than asserting that every dwelling liability supplement is permanently restricted to $100,000.

Coverage L also generally includes the insurer's defense obligation in addition to covered damages, subject to the policy's exclusions and conditions.

Therefore, the required answer is B.

The correct answer is D — Windstorm. The Commercial Property Causes of Loss — Special Form operates primarily on an open-perils basis. Rather than limiting coverage only to individually listed causes of loss, it generally covers risks of direct physical loss unless the cause is specifically excluded or limited by the form.

The Special Form specifically excludes smog. It also contains a Water exclusion that includes flood, surface water, waves, overflow of bodies of water, mudslide, and mudflow. Consequently, options A, B, and C describe causes specifically removed from the broad Special Form coverage grant.

Windstorm, by contrast, is not generally excluded by the standard Causes of Loss — Special Form. Direct physical damage caused by wind is therefore ordinarily covered unless another exclusion, limitation, endorsement, or property-specific provision applies.

This illustrates an essential adjusting distinction. Under a named-perils form, the insured must establish that the damage resulted from one of the listed covered causes. Under an open-perils Special Form, analysis begins with broad direct physical loss coverage and then determines whether an exclusion or limitation removes the loss.

The Series 17-70 outline specifically covers Commercial Property causes-of-loss forms, exclusions, and open-versus-named-peril concepts.

Therefore, D is correct.

The correct answer is D — declarations page. More precisely, the standard Workers Compensation and Employers Liability Policy refers to the Information Page, which performs the declarations-page function for this policy.

Under Part Three — Other States Insurance, the employer may receive workers compensation and employers liability protection in qualifying states not listed under the primary-state portion of the policy. The New York Compensation Insurance Rating Board expressly provides that states where Other States coverage is to apply must be listed in Item 3.C. of the Information Page.

Because “Information Page” is not offered among the four answer choices, declarations page is the intended and technically equivalent examination response.

Option A is incorrect because merely mentioning a state in an application does not activate contractual coverage. Option B contains the insurer's broad promise but does not identify the states selected for Other States protection. Option C is not the standard policy mechanism used for this purpose.

The Series 17-70 outline expressly includes Part Three — Other States Insurance, along with Parts One through Six of the standard Workers Compensation and Employers Liability policy.

Therefore, D is correct.

The correct answer is C. Accident-only insurance is a limited form of accident and health coverage in which benefits are triggered by an accident or specified category of accidental event, rather than by sickness generally. The NAIC defines an accident as an unexpected event or circumstance without deliberate intent and describes accident-only insurance as coverage for death, dismemberment, disability, hospital treatment, or medical care caused or necessitated by an accident or specified kinds of accidents.

Option A is incorrect because illness is not converted into an accident simply because its onset is unexpected. Coverage for sickness belongs to health or medical insurance provisions unless specifically included by another policy form. Option B, congenital diseases, similarly concerns medical conditions rather than accidental occurrences. Option D is too broad because the mere absence of intentional conduct does not automatically satisfy the policy's definition of an accidental injury or covered accident. There must be the required causal connection to an insured accidental event.

The Series 17-70 content outline expressly tests Accidental Injury, classes of accident and health coverage, limited policies, and specifically Accident-Only coverage.

Accordingly, a fortuitous, unexpected accidental event is the operative trigger, making C the correct answer.

The correct answer is C — Garagekeepers Coverage. Garagekeepers coverage addresses loss to customers' automobiles while those vehicles are in the insured garage operation's care, custody, or control, such as while being serviced, repaired, parked, stored, or otherwise attended by the insured.

This distinction is essential because ordinary liability coverage contains a care, custody, or control exclusion for damage to property entrusted to the insured. If an automobile repair business damages a customer's automobile while the vehicle is in the shop's custody, ordinary business auto or general liability property-damage protection generally does not fill that exposure. Garagekeepers coverage is specifically designed for it.

Physical Damage Coverage ordinarily protects covered autos owned or otherwise qualifying under the insured's own physical-damage symbols; it is not synonymous with protection for customer vehicles entrusted to the business. “Specified Coverage” is not the relevant garage-form coverage division.

Garagekeepers may be structured on a legal-liability basis or, depending on available forms, direct primary or direct excess bases. The precise form affects whether negligence must be established.

The official Series 17-70 examination outline expressly includes Garage Coverage, Garage Keeper's Coverage, Liability Coverage, Physical Damage Coverage, Exclusions, Conditions, and Definitions within Commercial Auto.

Therefore, the correct answer is C.

The correct answer is C — Injury to farm employees. The standard Farm Liability Coverage Form provides several principal liability protections. These include Coverage H — Bodily Injury and Property Damage Liability, Coverage I — Personal and Advertising Injury Liability, and Coverage J — Medical Payments. These correspond directly to options D, B, and A.

In contrast, bodily injury sustained by an employee as a result of employment by the insured is generally excluded from the standard liability coverage. Standard Farm Liability wording excludes most bodily injury to an employee arising out of and in the course of employment, reflecting the principle that occupational injuries should ordinarily be handled through Workers Compensation or specialized farm-employer coverage rather than general farm liability.

Where broader protection for farm employees is needed, specialized endorsements or separate statutory coverage may modify the exposure. An adjuster must therefore distinguish third-party farm liability from an employer's obligations to employees.

The Series 17-70 outline specifically includes farm liability concepts and requires candidates to distinguish covered liability hazards from employee-related exclusions.

Therefore, C is correct.

The correct answer is D. New York's mandatory automobile physical-damage inspection requirements are fundamentally an anti-fraud and loss-verification mechanism. By inspecting and documenting the automobile when collision or comprehensive coverage is written, the insurer establishes the vehicle's pre-insurance physical condition. If a later claim is submitted, the insurer can compare claimed damage with the condition documented before or at the inception of physical-damage coverage.

New York DFS explains that when physical-damage coverage applies, the insurer inspects and photographs the automobile for comparison purposes if future damages are claimed. That directly supports D: the process helps prevent payment for pre-existing damage incorrectly presented as having occurred during the policy period.

The inspection is not primarily intended to surcharge vehicles because they are cosmetically imperfect, making A incorrect. It is not a consumer notification program concerning scratches or dents, eliminating B. Nor does it guarantee that covered vehicles are in “top condition,” so C is incorrect.

The Series 17-70 examination outline expressly identifies mandatory inspection requirements for private passenger automobiles under Regulation 79, Parts 67.0–67.11 as an Auto Insurance examination subject.