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FL Claims Adjuster practice questions

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Question 1Insurance Regulation and Licensing (Florida)

Which Florida entity is responsible for issuing licenses to insurance adjusters?

  1. Office of Insurance Regulation
  2. Financial Services Commission
  3. Office of the Attorney General
  4. Department of Financial Services Correct answer.

Explanation

Adjuster licenses in Florida are issued by the Department of Financial Services through its Division of Agent and Agency Services, which acts under the elected Chief Financial Officer. The Office of Insurance Regulation handles insurer solvency, rates, and forms rather than individual licensee credentials.

Question 2Insurance Regulation and Licensing (Florida)

Who appoints the Commissioner who heads the Florida Office of Insurance Regulation?

  1. The Florida Senate by majority vote
  2. The Chief Financial Officer acting alone
  3. The Financial Services Commission Correct answer.
  4. The Governor acting alone without additional approval

Explanation

The Financial Services Commission is composed of the Governor, the Chief Financial Officer, the Attorney General, and the Commissioner of Agriculture, and it appoints the Commissioner of the Office of Insurance Regulation. The appointee serves at the pleasure of that commission.

Question 3Insurance Regulation and Licensing (Florida)

How often must a Florida adjuster license be renewed?

  1. Every year on the anniversary of the license issue date
  2. Every 2 years, expiring the last day of the birth month Correct answer.
  3. Every 3 years on the anniversary of the license issue date
  4. Every 4 years on the anniversary of the license issue date

Explanation

Florida licenses for adjusters run on a biennial cycle and expire on the last day of the licensee's birth month. Continuing education and renewal fees must be completed before that expiration date to keep the license in good standing.

Question 4Insurance Regulation and Licensing (Florida)

How many continuing education hours must a Florida adjuster complete during each two-year license period?

  1. 24 hours, including 3 hours of ethics Correct answer.
  2. 20 hours, including 2 hours of ethics
  3. 16 hours, including 2 hours of ethics
  4. 12 hours, including 1 hour of ethics

Explanation

Florida requires adjusters to complete 24 hours of approved continuing education every two years, and a portion of that total must be devoted to ethics instruction. Hours must come from approved providers and be reported before the renewal deadline.

Question 5Insurance Regulation and Licensing (Florida)

After signing a contract with a public adjuster, how long does a Florida insured have to rescind that contract?

  1. 3 business days Correct answer.
  2. 10 business days
  3. 2 business days
  4. 1 business day

Explanation

A public adjusting contract must advise the insured of the right to cancel in writing within three business days after signing. This cooling-off right protects consumers from hasty decisions made shortly after a loss.

Question 6Insurance Regulation and Licensing (Florida)

For a claim arising out of a declared state of emergency, what is the maximum fee a Florida public adjuster may charge?

  1. 10 percent of the claim payment Correct answer.
  2. 25 percent of the claim payment
  3. 20 percent of the claim payment
  4. 15 percent of the claim payment

Explanation

Florida caps public adjuster compensation at 20 percent of the claim payment generally, but lowers the cap to 10 percent when the claim arises from a loss covered by a declared state of emergency. Charging more than the applicable cap is a licensing violation.

Question 7Insurance Regulation and Licensing (Florida)

A public adjuster licensed in Florida represents which party in a claim?

  1. The insurer that issued the policy
  2. The insured who hired the adjuster Correct answer.
  3. The reinsurer behind the policy
  4. The Department of Financial Services

Explanation

A public adjuster is retained by and works for the policyholder, preparing and negotiating the claim against the insurer for a fee. Company and independent adjusters, by contrast, act for the insurer.

Question 8Insurance Regulation and Licensing (Florida)

Which statement correctly describes a company adjuster in Florida?

  1. An adjuster who contracts with many insurers on a fee basis
  2. An adjuster retained by the insured for a share of the recovery
  3. An adjuster employed by the Department to review complaints
  4. An adjuster who is a salaried employee of one insurer Correct answer.

Explanation

A company adjuster is a salaried employee of a single insurer and handles that insurer's claims. Independent adjusters work under contract for multiple insurers, and public adjusters are retained by policyholders.

Question 9Insurance Regulation and Licensing (Florida)

A person with no Florida adjuster license negotiates and settles a homeowner's claim for a fee. How is this conduct best characterized?

  1. The conduct is lawful if the insurer approves it in writing before payment
  2. No violation exists if the claim is under $10,000
  3. Unlicensed activity punishable by fines and criminal penalties Correct answer.
  4. The conduct is lawful if the person works from another state

Explanation

Adjusting claims for compensation requires a Florida license, and performing that activity without one is unlicensed activity. The Department may impose administrative fines and issue cease and desist orders, and the conduct may also support criminal prosecution.

Question 10Insurance Regulation and Licensing (Florida)

Which adjuster action constitutes an unfair claim settlement practice under Florida law?

  1. Denying a claim in writing with the policy language cited
  2. Misstating policy terms to justify a lower settlement Correct answer.
  3. Requesting a signed proof of loss before evaluating damages
  4. Referring a suspicious claim to the insurer's fraud unit

Explanation

Florida's Unfair Insurance Trade Practices Act prohibits misrepresenting policy provisions or facts to induce a claimant to accept less than what is owed. Routine steps such as requesting a proof of loss or issuing a written, reasoned denial are proper claim handling.

Question 11Insurance Regulation and Licensing (Florida)

An adjuster suspects that a claimant submitted altered repair invoices. Where should the suspicion be reported under Florida law?

  1. The local police department only
  2. The Office of Insurance Regulation
  3. The Division of Investigative and Forensic Services Correct answer.
  4. The National Association of Insurance Commissioners

Explanation

The Department of Financial Services investigates insurance fraud through its Division of Investigative and Forensic Services. Insurers and licensees are expected to report suspected fraudulent claims to that division.

Question 12Insurance Regulation and Licensing (Florida)

A licensed Florida adjuster moves to a new residence. Within how many days must the licensee notify the Department of the address change?

  1. 10 days
  2. 15 days
  3. 30 days Correct answer.
  4. 20 days

Explanation

A licensee must give the Department written notice of a change of name or address within 30 days of the change. Keeping the licensing file current ensures renewal notices and official correspondence are received.

Question 13Insurance Regulation and Licensing (Florida)

Which is a basic requirement for obtaining a Florida all-lines adjuster license?

  1. Being 18 or older and passing the state exam Correct answer.
  2. A surety bond filed with the Department
  3. A four-year college degree in insurance or finance
  4. Five years of prior claims handling experience

Explanation

Applicants must be at least 18 years of age, meet character and background requirements, and pass the appropriate licensing examination. A college degree and prior experience are not required, and a surety bond is required only for public adjusters.

Question 14Insurance Regulation and Licensing (Florida)

Which statement about nonresident adjuster licensing in Florida is correct?

  1. A nonresident must post a $100,000 surety bond before licensing
  2. A nonresident may never be licensed to adjust Florida claims
  3. Reciprocity lets a licensed nonresident obtain a Florida license Correct answer.
  4. A nonresident must establish Florida residency within one year

Explanation

Florida issues nonresident adjuster licenses to individuals who hold a comparable license in good standing in another state that grants reciprocal treatment to Florida licensees. The nonresident license is renewed and monitored like a resident license.

Question 15Insurance Regulation and Licensing (Florida)

An adjuster completes all required continuing education except the ethics hours before the renewal deadline. What is the effect?

  1. The license renews automatically with a written warning
  2. The licensee may keep adjusting claims while finishing the hours
  3. Only the ethics hours must be made up before renewal
  4. The licensee may not transact business until reinstated Correct answer.

Explanation

Renewal requires completion of the full continuing education requirement, including the ethics component. Until the deficiency is cured and the license is reinstated, the individual may not perform adjuster activities.

Question 16Insurance Regulation and Licensing (Florida)

Which of these persons most clearly needs a Florida adjuster license?

  1. An actuary who calculates claim reserves for an insurer
  2. A customer service representative who quotes premiums
  3. A contractor who settles a claim for a fee Correct answer.
  4. A clerical employee who opens mail and assigns claim numbers

Explanation

Anyone who investigates, negotiates, or settles claims for compensation on behalf of an insurer or a policyholder must be licensed. Purely clerical, actuarial, and sales functions do not fall within the definition of adjusting.

Question 17Insurance Regulation and Licensing (Florida)

What financial guarantee must a Florida public adjuster maintain as a condition of licensure?

  1. A certificate of deposit held by the Department
  2. Errors and omissions coverage of $100,000
  3. A letter of credit from a Florida bank
  4. A $50,000 surety bond Correct answer.

Explanation

Florida requires public adjusters to file and maintain a surety bond in the amount of $50,000, which protects consumers who entrust claim matters to the adjuster. Company and independent adjusters are not subject to this bond requirement.

Question 18Insurance Regulation and Licensing (Florida)

Which practice is prohibited under Florida's Unfair Insurance Trade Practices Act?

  1. Misrepresenting policy terms to induce a policy lapse Correct answer.
  2. Providing a claimant a copy of the policy at no charge
  3. Documenting a claim denial with the applicable policy language
  4. Explaining a policy exclusion in writing to a claimant

Explanation

Misrepresenting the terms of a policy to persuade a policyholder to drop or replace coverage is a prohibited practice known as twisting. Accurate written explanations of coverage and copies of the policy are proper conduct.

Question 19Insurance Regulation and Licensing (Florida)

A public adjuster pays part of a claim fee to an unlicensed friend who referred a homeowner to him. How does Florida law treat this payment?

  1. Prohibited, because fees may not be shared with an unlicensed person Correct answer.
  2. Permitted because the friend never held himself out as an adjuster
  3. Permitted if the insured consents in writing
  4. Permitted if the amount is less than 10 percent of the fee

Explanation

Compensation for soliciting or referring claim business may not be paid to an unlicensed person. Sharing a public adjusting fee with an unlicensed referrer is a licensing violation regardless of amount or consent.

Question 20Insurance Regulation and Licensing (Florida)

For a Florida property insurance claim, how many days does an insurer have to acknowledge receipt of the claim after notification?

  1. 30 days
  2. 14 days Correct answer.
  3. 5 days
  4. 10 days

Explanation

Florida's property claim statute requires the insurer to acknowledge receipt of the claim within 14 days after notification. The insurer must also begin investigating the claim within a short statutory period after that acknowledgment.

Question 21Insurance Regulation and Licensing (Florida)

After receiving a completed proof of loss on a Florida property claim, within what period must the insurer pay or deny the claim?

  1. 45 days
  2. 120 days
  3. 30 days
  4. 90 days Correct answer.

Explanation

Florida requires an insurer to pay or deny a property claim, in whole or in part, within 90 days after receipt of the proof of loss. Failure to meet the deadline can expose the insurer to bad faith and administrative action.

Question 22Insurance Regulation and Licensing (Florida)

A Florida consumer has a complaint about how an insurer handled her claim. Which unit within the Department of Financial Services assists consumers?

  1. Division of Consumer Services Correct answer.
  2. Office of Insurance Regulation
  3. Division of Agent and Agency Services
  4. Division of Investigative and Forensic Services

Explanation

The Division of Consumer Services receives and helps resolve consumer complaints and questions about insurance, operating a toll-free helpline and online services. It is distinct from the units that license agents and adjusters or prosecute fraud.

Question 23Insurance Regulation and Licensing (Florida)

Which document authorizes an insurer to transact insurance business in Florida?

  1. A certificate of authority issued by the Office of Insurance Regulation Correct answer.
  2. A license issued by the Division of Agent and Agency Services of the DFS
  3. A rate approval issued by the Financial Services Commission
  4. A bond filed with the Division of Consumer Services

Explanation

An insurer must obtain a certificate of authority from the Office of Insurance Regulation before conducting insurance business in Florida. Individual agents and adjusters receive licenses from the Department of Financial Services instead.

Question 24Insurance Regulation and Licensing (Florida)

An adjuster who holds both a public adjuster license and a company adjuster license is retained by the insured on a claim and also paid by the insurer on that same claim. How should this be evaluated?

  1. Permitted if the insurer and insured both sign a waiver
  2. Prohibited; one adjuster may not serve both parties Correct answer.
  3. Permitted if total compensation is disclosed to the insured
  4. Permitted only if the claim exceeds $50,000

Explanation

An adjuster may not act for both the insurer and the insured on the same claim, because the roles create a direct conflict of interest. Disclosure, waivers, or the size of the claim do not cure the dual representation.

Question 25Insurance Regulation and Licensing (Florida)

Which of these is a ground for disciplinary action against a Florida adjuster's license?

  1. Recording detailed claim file notes
  2. Requesting a proof of loss from a claimant
  3. Attending an approved continuing education seminar
  4. Misappropriating claim funds held in trust Correct answer.

Explanation

Handling claim funds in a fiduciary capacity requires strict honesty; misappropriation is grounds for suspension, revocation, and possible criminal charges. Ordinary claim handling tasks and continuing education compliance are not violations.

Question 26Insurance Regulation and Licensing (Florida)

Which Florida agency issues licenses to insurance adjusters?

  1. Department of Business Regulation
  2. Office of Insurance Regulation
  3. Department of Financial Services Correct answer.
  4. Division of Consumer Services

Explanation

Adjuster licenses are issued and renewed through the Florida Department of Financial Services, which houses the bureau that processes agent and adjuster licensing. The Office of Insurance Regulation and the Division of Consumer Services perform different functions within the state's insurance regulatory structure.

Question 27Insurance Regulation and Licensing (Florida)

An emergency (catastrophe) adjuster license issued in Florida because of a declared emergency remains valid for what period?

  1. 60 days
  2. 180 days Correct answer.
  3. 90 days
  4. One year

Explanation

Florida law limits an emergency adjuster license issued for a declared emergency to 180 days, after which the holder must obtain a regular license to continue adjusting. The short term reflects the temporary purpose of the license.

Question 28Insurance Regulation and Licensing (Florida)

After an insured signs a written contract with a Florida public adjuster, how long does the insured have to rescind the contract?

  1. Five business days
  2. Two calendar days
  3. One business day
  4. Three business days Correct answer.

Explanation

Florida requires the public adjuster contract to advise the insured of a right to cancel within three business days after signing. The contract must be in writing and contain the required rescission notice for it to be enforceable.

Question 29Insurance Regulation and Licensing (Florida)

How many hours of continuing education must an all-lines adjuster complete during each two-year license term in Florida?

  1. 40 hours
  2. 30 hours
  3. 12 hours
  4. 24 hours Correct answer.

Explanation

Florida adjusters must complete 24 hours of approved continuing education each two-year term, and a portion of those hours must be in ethics and Florida-specific law and update courses. Renewal is conditioned on timely completion.

Question 30Insurance Regulation and Licensing (Florida)

For a claim that does not arise from a declared state of emergency, what is the maximum fee a Florida public adjuster may charge?

  1. 10 percent of the claim proceeds
  2. 15 percent of the claim proceeds
  3. 25 percent of the claim proceeds
  4. 20 percent of the claim proceeds Correct answer.

Explanation

Florida caps a public adjuster's compensation at 20 percent of the amount the insured recovers, with a lower cap during a declared state of emergency. Any contract term calling for more than the statutory maximum is unenforceable as to the excess.

Question 31Insurance Regulation and Licensing (Florida)

A Florida-licensed adjuster is charged with a felony. Within how many days must the licensee notify the Department of Financial Services?

  1. 10 days
  2. 60 days
  3. 90 days
  4. 30 days Correct answer.

Explanation

Licensees must report criminal charges to the Department within 30 days after the initial pretrial hearing date, and failure to do so is itself a ground for discipline. The duty applies even if the charges are later dropped.

Question 32Insurance Regulation and Licensing (Florida)

Which action by a Florida public adjuster is prohibited?

  1. Using a written contract signed by the insured
  2. Purchasing the insured's damaged property at a discount Correct answer.
  3. Negotiating a settlement with the insurer on the insured's behalf
  4. Charging a fee calculated as a percentage of the recovery

Explanation

A public adjuster may not acquire an interest in the insured's property or claim, because that creates a conflict with the duty to maximize the insured's recovery. Negotiating settlements, percentage-based fees within the cap, and written contracts are all permitted.

Question 33Insurance Regulation and Licensing (Florida)

A public adjuster works a claim under a valid contract, but the insurer ultimately pays the insured nothing. What compensation may the adjuster collect?

  1. A flat fee equal to the amount stated in the contract
  2. An hourly fee for the time the adjuster reasonably spent
  3. A reduced percentage equal to half the contracted rate
  4. Nothing, since fees are a percentage of recovery Correct answer.

Explanation

Public adjuster compensation is a percentage of the amount the insured recovers, so a claim that produces no payment produces no fee. Hourly and flat-fee arrangements are inconsistent with the percentage-based fee structure the statute authorizes.

Question 34Insurance Regulation and Licensing (Florida)

What must an applicant for a Florida adjuster license submit so the Department can conduct a criminal history check?

  1. A physician's certification
  2. A surety bond
  3. A set of fingerprints Correct answer.
  4. A personal credit report

Explanation

Adjuster license applicants must be fingerprinted so the Department can run a state and federal criminal history check. A public adjuster bond is a separate requirement for that license type and does not replace fingerprinting.

Question 35Insurance Regulation and Licensing (Florida)

A Florida public adjuster contract must contain which statement?

  1. That the adjuster represents the insured only Correct answer.
  2. That the insured waives all rescission rights
  3. That the insurer will pay the adjuster's fee
  4. That the adjuster is an employee of the insurer

Explanation

The contract must make clear that the public adjuster represents the insured and not the insurer, so the insured understands whose interests the adjuster serves. The contract must also state the fee and the insured's rescission rights.

Question 36Insurance Regulation and Licensing (Florida)

An adjuster's Florida license expires and is not renewed, but the adjuster keeps negotiating claims for an insurer. How is this conduct treated?

  1. Lawfully, since the insurer authorized the work
  2. As unlicensed activity subject to penalties Correct answer.
  3. Unlawfully, but only if the claim is underpaid
  4. Lawfully, while a renewal application is pending

Explanation

Adjusting claims requires a current license, so working after expiration is unlicensed activity regardless of the insurer's approval or the outcome of the claim. The Department may pursue administrative penalties and other remedies for that conduct.

Question 37Insurance Regulation and Licensing (Florida)

Which Florida entity reviews and approves the policy forms and rates filed by insurers?

  1. Division of Consumer Services
  2. Office of Insurance Regulation Correct answer.
  3. Division of Agent and Agency Services
  4. Department of Financial Services

Explanation

The Office of Insurance Regulation handles insurer-facing regulation such as rates, forms, and solvency, while the Department of Financial Services licenses individual agents and adjusters. Complaint handling sits with the Division of Consumer Services.

Question 38Insurance Regulation and Licensing (Florida)

A licensee contests the factual allegations in a disciplinary complaint filed by the Department. Where is the dispute ordinarily heard?

  1. The Department's internal probable cause panel
  2. The circuit court where the licensee resides
  3. An administrative law judge at DOAH Correct answer.
  4. The Financial Services Commission in public session

Explanation

Disputed facts in a licensing discipline case are referred to the Division of Administrative Hearings, where an administrative law judge takes evidence and recommends findings under the state's administrative procedure law. The probable cause panel screens cases rather than conducting the trial.

Question 39Insurance Regulation and Licensing (Florida)

A Florida public adjuster contract on a non-emergency claim sets the fee at 30 percent of the claim proceeds. What is the legal effect?

  1. The excess is payable once the insurer pays the claim
  2. The entire contract is void and the adjuster forfeits all pay
  3. The excess fee is unenforceable and discipline may follow Correct answer.
  4. The contract is fully enforceable as written by the parties

Explanation

Because the statutory cap is 20 percent for a non-emergency claim, the provision above the cap cannot be enforced and the adjuster risks disciplinary action for charging it. The insured's obligation is limited to the lawful maximum.

Question 40Insurance Regulation and Licensing (Florida)

An applicant is applying for a Florida public adjuster license and asks what surety bond amount must be filed with the Department before the license can be issued. Which amount satisfies Florida's requirement?

  1. $10,000
  2. $25,000
  3. $100,000
  4. $50,000 Correct answer.

Explanation

Florida requires each licensed public adjuster to file and maintain a $50,000 surety bond with the Department, conditioned on the faithful performance of the adjuster's duties. Because the bond requirement is a licensing condition, the applicant cannot be licensed until the required bond is on file.

Question 41Insurance Principles and Concepts

The principle of indemnity is best described as which of the following?

  1. Shifting all of the insured's risk to a reinsurer
  2. Paying the face amount without regard to the actual loss
  3. Allowing the insured to profit when property values rise
  4. Restoring the insured to the pre-loss financial position Correct answer.

Explanation

Indemnity means the insured is made whole after a loss, no better off and no worse off, subject to policy limits and the valuation method used. It prevents recovery that exceeds the actual financial loss.

Question 42Insurance Principles and Concepts

For property insurance, insurable interest generally must exist at which point?

  1. Only when the application is signed
  2. Only when the policy is renewed
  3. At the time the premium is first paid
  4. At the time of the loss Correct answer.

Explanation

In property insurance, the insured must have an insurable interest at the time of the loss, because that is when the financial loss actually occurs. Life insurance differs, requiring insurable interest at inception but not at death.

Question 43Insurance Principles and Concepts

The doctrine of utmost good faith in insurance primarily requires the applicant to do which of the following?

  1. Disclose all material facts needed to evaluate the risk Correct answer.
  2. Read every policy endorsement before a loss occurs
  3. Accept every offer of coverage the insurer makes
  4. Hire a licensed public adjuster for all claims

Explanation

Insurance relies on the applicant disclosing material facts that affect the insurer's decision to accept or price the risk. A failure to do so can allow the insurer to rescind or deny coverage.

Question 44Insurance Principles and Concepts

Because an insurance policy is a contract of adhesion, a court typically resolves an ambiguous policy provision in favor of which party?

  1. The reinsurer, because it ultimately bears the risk of loss
  2. The insured, who had no part in drafting the wording Correct answer.
  3. Neither party, because ambiguity voids the policy
  4. The insurer, because it drafted the policy

Explanation

A contract of adhesion is drafted by one party and accepted or rejected by the other. When wording is genuinely ambiguous, courts generally construe it against the drafter, which is the insurer.

Question 45Insurance Principles and Concepts

An insurance contract is aleatory because which of the following is true?

  1. The insured may cancel at any time without consequence
  2. The policy must be issued at a price set by the state
  3. The amounts exchanged may be unequal and depend on chance Correct answer.
  4. Both parties are equally bound to perform at the same time

Explanation

In an aleatory contract, the dollar amounts exchanged by the parties are not equal and depend on the occurrence of an uncertain event. A small premium may result in a large claim payment, or no payment at all.

Question 46Insurance Principles and Concepts

An insurance policy is considered a unilateral contract because only which party makes a legally enforceable promise?

  1. The beneficiary, who promises to cooperate
  2. The insured, who promises to pay premiums
  3. The agent, who promises to service the account
  4. The insurer, which promises to pay covered claims Correct answer.

Explanation

Only the insurer makes an enforceable promise to pay covered claims. The insured's payment of premium is a condition that keeps coverage in force, not a promise the insurer can compel.

Question 47Insurance Principles and Concepts

What does it mean that an insurance policy is a conditional contract?

  1. The insurer may change the premium at any time without notice
  2. The insured must accept all endorsements the insurer issues
  3. The insurer pays only if the insured meets stated conditions Correct answer.
  4. Coverage begins only after the first claim is reported

Explanation

The insurer's duty to pay is conditional on the insured satisfying policy conditions, such as giving prompt notice and submitting a proof of loss. Failure to meet a material condition can affect the claim.

Question 48Insurance Principles and Concepts

Because a property insurance policy is generally a personal contract, the policy responds to which of the following?

  1. The mortgagee's interest only, until the loan is repaid
  2. The insured's financial interest in the property Correct answer.
  3. The property itself, no matter who owns it
  4. Any person who happens to occupy the premises

Explanation

Property insurance follows the insured's financial interest rather than the property itself. That is why coverage generally does not automatically transfer to a new owner when property is sold.

Question 49Insurance Principles and Concepts

The law of large numbers helps an insurer predict losses because it states that which of the following occurs as the number of similar exposure units increases?

  1. The average severity of each loss declines to zero
  2. The need to collect premiums disappears
  3. Individual losses become entirely predictable
  4. Actual losses tend to approach the expected loss level Correct answer.

Explanation

As an insurer pools more similar exposure units, actual aggregate losses tend to come closer to the expected level. This improves the reliability of ratemaking and reserving.

Question 50Insurance Principles and Concepts

Adverse selection is a concern for insurers because it typically involves which of the following?

  1. Applicants with a higher-than-average chance of loss seeking coverage Correct answer.
  2. Insurers rejecting applicants who present standard risks
  3. Agents selling policies to unlicensed applicants
  4. Courts selecting policy language for interpretation

Explanation

Adverse selection occurs when people with greater-than-average loss potential are more likely to buy or keep insurance. Insurers counter it through underwriting, exclusions, and proper pricing.