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GA Public Adjuster practice questions

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Question 1Licensing and Regulation of Public Adjusters

Under Georgia law, which individual is required to hold a public adjuster license before negotiating a first-party property claim on behalf of an insured for compensation?

  1. A person who performs only clerical typing of claim correspondence for an adjusting firm
  2. A person who, for compensation, assists the insured in negotiating a settlement of a claim Correct answer.
  3. A person who provides a single uncompensated opinion to a neighbor about a claim
  4. A person who settles claims solely for the insurer that issued the policy

Explanation

The licensing trigger for public adjusters is acting for compensation on behalf of the insured in negotiating or settling a first-party claim. Insurer-side staff adjusters are licensed under a different category, and purely clerical or uncompensated one-off help does not trigger the license.

Question 2Licensing and Regulation of Public Adjusters

An applicant for a Georgia public adjuster license must generally satisfy which requirement before the license is issued?

  1. Holding a Georgia real estate salesperson license
  2. Obtaining a written endorsement from three insurers
  3. Posting a surety bond and passing the required licensing examination Correct answer.
  4. Completing a four-year degree in insurance

Explanation

Georgia requires public adjuster applicants to pass the applicable licensing examination and to file a surety bond as a condition of licensure. Neither a college degree, a real estate license, nor insurer endorsements is a statutory prerequisite.

Question 3Licensing and Regulation of Public Adjusters

A licensed Georgia public adjuster wants to solicit claims in a neighboring state where public adjusters must be licensed. What is the adjuster's most appropriate course of action?

  1. Rely on the insurer's adjuster license to cover the activity
  2. Solicit only if the homeowner signs a waiver of the other state's licensing law
  3. Obtain a nonresident license or other authority from that state before soliciting Correct answer.
  4. Solicit freely because a Georgia license is valid nationwide

Explanation

Licensing is state-based, so a public adjuster who solicits or negotiates claims in another state must hold that state's license, typically through a nonresident application. A Georgia license alone confers no authority outside Georgia, and a homeowner cannot waive a state's licensing statute.

Question 4Licensing and Regulation of Public Adjusters

Which conduct by a licensed public adjuster would most likely subject the license to disciplinary action by the Georgia Department of Insurance?

  1. Explaining the policy's coverage limits to the insured in writing
  2. Keeping copies of the claim file for the adjuster's own records
  3. Misappropriating funds the insured paid as the adjuster's fee Correct answer.
  4. Declining a claim assignment because of a scheduling conflict

Explanation

Conversion or misappropriation of money entrusted in the course of the adjusting business is a classic ground for license suspension or revocation. Retaining file copies, declining an assignment, and explaining coverage are ordinary and lawful practices.

Question 5Licensing and Regulation of Public Adjusters

A public adjuster's written contract with an insured must contain which element to be enforceable under Georgia rules?

  1. A clause waiving the insured's right to cancel the contract
  2. A statement that the adjuster's fee is contingent on the settlement amount Correct answer.
  3. A guarantee that the claim will be paid in full
  4. A promise that the insurer will pay the adjuster's fee directly

Explanation

Public adjuster compensation must be tied to the amount of the settlement, so the contract must clearly state that the fee is contingent on the claim recovery. The contract may not waive the insured's cancellation right, and adjusters cannot guarantee claim outcomes or bind the insurer to pay fees.

Question 6Licensing and Regulation of Public Adjusters

An insured signs a public adjuster contract on Monday. Under Georgia's cancellation provision, the insured may rescind the contract without penalty within what period?

  1. Three business days after signing Correct answer.
  2. Thirty days after signing
  3. No cancellation right exists once the contract is signed
  4. Twenty-four hours after signing

Explanation

Georgia law gives the insured a three-business-day right to cancel a public adjuster contract by written notice, and the contract must disclose that right. This cooling-off period protects insureds from hasty decisions at a stressful time.

Question 7Licensing and Regulation of Public Adjusters

Which fee arrangement for a public adjuster representing an insured on a homeowners claim is consistent with Georgia requirements?

  1. A fee set as a percentage of the insurance settlement proceeds Correct answer.
  2. A fee equal to the difference between the initial offer and the final payment
  3. A flat retainer collected before any work begins and never refundable
  4. A fee paid from the insurer's claim payment without the insured's knowledge

Explanation

Public adjuster compensation must be contingent on and calculated as a percentage of the settlement amount, which aligns the adjuster's interest with the insured's recovery. Flat nonrefundable retainers, undisclosed fees, and arrangements concealed from the insured are inconsistent with the statute.

Question 8Licensing and Regulation of Public Adjusters

A public adjuster is hired by a homeowner two days after a fire. Which action by the adjuster best reflects the adjuster's duty to the insured?

  1. Settle the claim directly with the insurer without informing the insured of the amount
  2. Refer the insured to the insurer's preferred contractor and accept a referral fee
  3. Prepare a documented inventory and estimate and submit the claim promptly to the insurer Correct answer.
  4. Advise the insured to delay reporting the loss to the insurer until the adjuster completes an estimate

Explanation

The public adjuster's role is to document, prepare, and advocate the insured's claim promptly and transparently. Delaying notice, settling without the insured's knowledge, or taking undisclosed referral compensation breaches the fiduciary duty owed to the insured.

Question 9Licensing and Regulation of Public Adjusters

Which statement about a public adjuster's use of claim settlement funds is correct under Georgia rules?

  1. The adjuster may apply the insured's settlement funds to the adjuster's fee without the insured's agreement
  2. The adjuster may hold settlement funds in a personal account if records are kept
  3. The adjuster must handle funds received on behalf of the insured in a fiduciary capacity and account for them Correct answer.
  4. The adjuster may commingle claim funds with business operating funds as long as the balance is tracked

Explanation

Funds received on behalf of an insured are held in trust and must be accounted for and disbursed as the insured directs. Commingling, personal use, or unilateral application of funds to fees is a breach of fiduciary duty and grounds for discipline.

Question 10Licensing and Regulation of Public Adjusters

A public adjuster license in Georgia comes up for renewal. Which statement accurately describes continuing education obligations?

  1. Continuing education is satisfied automatically by paying the renewal fee
  2. Licensees must complete approved continuing education hours each renewal cycle Correct answer.
  3. Continuing education is required only after the first disciplinary action
  4. Continuing education is optional for adjusters with more than ten years of experience

Explanation

Georgia requires public adjusters to complete approved continuing education credits during each renewal period as a condition of keeping the license active. Experience, payment of fees, or disciplinary history does not substitute for the coursework.

Question 11Licensing and Regulation of Public Adjusters

An applicant's public adjuster license application is denied by the Department. What is the applicant's most appropriate next step?

  1. Begin adjusting claims while the denial is under review
  2. Request a hearing to contest the denial under the applicable administrative procedure Correct answer.
  3. Ask the insurer to sponsor the applicant as a public adjuster
  4. Reapply in another state and adjust Georgia claims under that license

Explanation

An applicant whose license is denied is entitled to contest the decision through the administrative hearing process rather than acting without authority. Adjusting during a denial or using another state's license to work Georgia claims would be unlicensed activity.

Question 12Licensing and Regulation of Public Adjusters

Which activity by a public adjuster most clearly constitutes unauthorized practice requiring a license?

  1. Negotiating a settlement of a fire loss with the insurer on behalf of the homeowner for a percentage fee Correct answer.
  2. Teaching an approved continuing education course on claim documentation
  3. Writing a general interest article about hurricane preparedness
  4. Serving as an expert witness on claim valuation in litigation

Explanation

Negotiating a first-party settlement for compensation on behalf of an insured is the core activity that requires a public adjuster license. Teaching, writing general information, and giving expert testimony are not the compensated negotiation of claims for insureds.

Question 13Licensing and Regulation of Public Adjusters

A public adjuster wants to advertise services after a hail storm. Which advertising practice complies with Georgia requirements?

  1. Displaying the state seal to imply government endorsement
  2. Soliciting door-to-door without identifying the adjuster's license status
  3. Using the phrase 'licensed by the state' with the license number and accurate contact information Correct answer.
  4. Promising a specific settlement amount to every homeowner who signs

Explanation

Advertising must be truthful and must accurately identify the adjuster's licensing status and contact information. Guaranteeing settlement amounts, implying government endorsement through the state seal, or concealing license status misleads the public and violates advertising standards.

Question 14Licensing and Regulation of Public Adjusters

A public adjuster is also a licensed contractor who wants to repair the same home whose claim the adjuster is handling. What is the most accurate statement about this arrangement?

  1. It is permitted only if the insurer recommends the adjuster as the contractor
  2. It creates a conflict of interest and is restricted because the adjuster cannot profit from repairs to the same loss Correct answer.
  3. It is permitted if the insured signs a repair contract before the claim settles
  4. It is always permitted because the adjuster holds both licenses

Explanation

A public adjuster may not use the adjusting relationship to profit from repair work on the same loss, because the adjuster's duty to maximize the insured's recovery conflicts with an interest in performing the repairs. Holding both licenses does not remove the conflict.

Question 15Licensing and Regulation of Public Adjusters

Which circumstance would most likely disqualify an individual from holding a Georgia public adjuster license?

  1. A felony conviction involving dishonesty or breach of trust Correct answer.
  2. Having worked previously as a company staff adjuster
  3. A prior misdemeanor traffic conviction from fifteen years ago
  4. Membership in a professional adjusting association

Explanation

A conviction for a felony involving dishonesty or breach of trust bears directly on the fitness to handle insureds' money and claims and is a standard disqualifier. Minor traffic offenses, association membership, and prior insurer-side experience are not disqualifying.

Question 16Licensing and Regulation of Public Adjusters

A public adjuster's license lapses because the renewal fee was not paid. What is the adjuster's status if the adjuster continues negotiating claims?

  1. Lawfully adjusting because the lapse is only administrative
  2. Lawfully adjusting for thirty days after the lapse
  3. Lawfully adjusting if the insured consents in writing
  4. Adjusting without a license and subject to penalties Correct answer.

Explanation

Once the license lapses, the adjuster has no authority to negotiate claims for insureds, and continuing to do so is unlicensed activity subject to enforcement. Administrative lapse, a grace period, or insured consent does not restore the authority.

Question 17Licensing and Regulation of Public Adjusters

A public adjuster is handling a claim in which the insured is also represented by an attorney. What is the adjuster's best practice for communicating with the insurer?

  1. Communicate directly with the insurer without informing the attorney
  2. Withdraw from the claim because attorney representation is prohibited
  3. Coordinate with the insured's attorney so communications and settlement authority are clear Correct answer.
  4. Ask the insurer to deal only with the adjuster and exclude the attorney

Explanation

When the insured has counsel, the adjuster should coordinate to avoid conflicting demands and unauthorized settlements. Excluding the attorney or acting without the insured's knowledge risks undermining the insured's representation and the adjuster's fiduciary duty.

Question 18Licensing and Regulation of Public Adjusters

Which recordkeeping practice best supports a public adjuster's compliance with Georgia requirements?

  1. Discarding claim records immediately after the settlement check is issued
  2. Retaining claim files and fee records for the period required by the Department and making them available on request Correct answer.
  3. Keeping records only in the insured's possession so the adjuster has nothing to produce
  4. Storing records without any identifying information to protect confidentiality

Explanation

Public adjusters must maintain accurate records of claims, fees, and transactions for the required retention period and produce them for examination. Destroying records early or keeping them in a form that cannot be produced obstructs regulatory oversight.

Question 19Licensing and Regulation of Public Adjusters

A public adjuster learns that a client's claim involves a loss the adjuster personally caused. What is the adjuster's appropriate action?

  1. Settle the claim quickly before the conflict becomes known
  2. Continue handling the claim and disclose the involvement only if the insurer asks
  3. Refer the claim to a colleague without disclosing the conflict to the insured
  4. Disclose the conflict and decline or withdraw from the representation Correct answer.

Explanation

An adjuster with a personal interest in the loss cannot provide loyal representation and must disclose the conflict and step aside. Concealing the conflict, quietly transferring the file, or rushing a settlement all breach the duty of loyalty.

Question 20Licensing and Regulation of Public Adjusters

Which statement correctly describes the relationship between a public adjuster and the insurer in a first-party claim?

  1. The public adjuster has authority to bind the insurer to a settlement
  2. The public adjuster acts as the insurer's agent when estimating the loss
  3. The public adjuster represents the insured and advocates the insured's position to the insurer Correct answer.
  4. The public adjuster must follow the insurer's instructions on claim valuation

Explanation

A public adjuster is retained by and owes duties to the insured, advocating the insured's claim to the insurer. The adjuster is not the insurer's agent, cannot bind the insurer, and is not directed by the insurer on valuation.

Question 21Licensing and Regulation of Public Adjusters

A public adjuster's license is suspended for a violation. Which statement about the adjuster's authority during the suspension is accurate?

  1. The adjuster has no authority to act as a public adjuster during the suspension Correct answer.
  2. The adjuster may act if the insured signs a new contract after the suspension
  3. The adjuster may continue all work if supervised by another licensee
  4. The adjuster may finish existing claims but may not accept new ones

Explanation

A suspension removes the adjuster's authority entirely for its duration, including work on existing files. Supervision by another licensee or a new insured contract cannot restore authority that the Department has suspended.

Question 22Licensing and Regulation of Public Adjusters

Which of these best describes the Department's authority over a licensed public adjuster's business records?

  1. The Department may examine records relevant to the adjuster's licensed activities during an investigation Correct answer.
  2. The Department has no authority to review an adjuster's business records
  3. The Department may review records only with the insured's written consent
  4. The Department may review records only after a criminal conviction

Explanation

As the licensing regulator, the Department has authority to examine records bearing on the adjuster's licensed activities when investigating complaints or conducting examinations. Consent, criminal conviction, or the absence of any authority are not preconditions.

Question 23Licensing and Regulation of Public Adjusters

An unlicensed person negotiates a homeowners claim for a fee and shares part of the fee with a licensed public adjuster. How should this arrangement be characterized?

  1. Permitted because a licensed adjuster is involved in the transaction
  2. Permitted if the insured agreed to the fee split in writing
  3. Permitted if the unlicensed person only prepared the estimate
  4. Prohibited because the licensed adjuster is sharing compensation with an unlicensed person for adjusting activity Correct answer.

Explanation

Adjusters may not share compensation with unlicensed persons for activities that require a license, because doing so circumvents the licensing scheme. Involving a licensee, limiting the unlicensed role to estimating, or obtaining the insured's consent does not cure the prohibited fee sharing.

Question 24Licensing and Regulation of Public Adjusters

A public adjuster solicits a homeowner at the scene of a fire before the fire department has cleared the property. Which concern is most directly raised by this conduct?

  1. The adjuster must wait until the insurer has assigned a staff adjuster
  2. Solicitation at a disaster scene may violate restrictions on unfair or deceptive solicitation practices Correct answer.
  3. The adjuster may solicit only after the claim is denied
  4. The adjuster may solicit only if the homeowner initiates the conversation

Explanation

Georgia restricts solicitation practices that exploit insureds at a vulnerable moment, such as approaching them at a loss scene before they can make an informed decision. Waiting for an insurer assignment or a denial is not a legal precondition, and the concern exists regardless of who speaks first.

Question 25Licensing and Regulation of Public Adjusters

Which statement about a public adjuster's duty to explain the contract to the insured is most accurate?

  1. The adjuster should ensure the insured understands the fee, the scope of services, and the cancellation right before signing Correct answer.
  2. The adjuster may summarize the contract only after the claim is settled
  3. The adjuster may leave explanation to the insurer's claims representative
  4. The adjuster may omit the fee terms if the insured does not ask

Explanation

Before the insured signs, the adjuster must make sure the insured understands the compensation, the services to be provided, and the right to cancel. Deferring explanation to settlement, relying on the insurer, or hiding fee terms defeats the informed-consent purpose of the contract rules.

Question 26Licensing and Regulation of Public Adjusters

Under Georgia law, which individual is required to hold a public adjuster license?

  1. A licensed insurance agent who only sells homeowners policies
  2. A salaried employee of an insurer who evaluates coverage on first-party claims
  3. A person who, for compensation, prepares and negotiates a first-party property claim on behalf of the insured Correct answer.
  4. A building contractor who prepares a repair estimate at the request of a homeowner

Explanation

Georgia requires a public adjuster license for anyone who, for compensation, acts on behalf of an insured to investigate, prepare, or negotiate a first-party claim. Employees of the insurer and agents selling policies act for the insurer, not the insured, so no public adjuster license applies. A contractor merely writing an estimate is not negotiating the claim.

Question 27Licensing and Regulation of Public Adjusters

Georgia's public adjuster licensing statute is administered by which authority?

  1. The Attorney General's consumer protection unit
  2. The Secretary of State's professional licensing boards
  3. The county superior court in the adjuster's county of residence
  4. The Department of Insurance, through its licensing division Correct answer.

Explanation

Public adjusters in Georgia are licensed and regulated by the Department of Insurance, which issues, renews, suspends, and revokes the license. The Secretary of State handles other professions, and courts do not administer adjuster licensing. The Department also enforces recordkeeping and conduct rules.

Question 28Licensing and Regulation of Public Adjusters

An applicant wants a Georgia public adjuster license. Which requirement must the applicant satisfy before the license is issued?

  1. Post a surety bond in an amount set by the Governor
  2. Obtain a written endorsement from a licensed Georgia public adjuster
  3. Complete two years of employment with an insurer's claims department
  4. Pass the required examination and submit a completed application with the required fee Correct answer.

Explanation

The core licensing path is a completed application, the required fee, and passage of the qualifying examination, along with any required background information. Prior insurer employment and sponsorship by an existing adjuster are not conditions of licensure. Bond amounts are not set by the Governor.

Question 29Licensing and Regulation of Public Adjusters

A Georgia public adjuster is licensed as an individual. Which statement about licensing a business entity as a public adjuster is correct?

  1. The license is issued to the individual, and the individual's qualification is what authorizes the adjusting activity Correct answer.
  2. A limited liability company may advertise public adjusting without any licensed individual attached
  3. A corporation automatically becomes a licensed public adjuster when it employs one licensed adjuster
  4. A partnership may adjust claims if at least one partner holds a nonresident adjuster license

Explanation

Public adjuster licensure in Georgia attaches to the individual who meets the qualification and examination requirements. A business entity does not become licensed merely by employing an adjuster, and it cannot lawfully hold itself out to adjust claims without a licensed individual performing the work. Advertising adjusting services without a licensed person is unauthorized practice.

Question 30Licensing and Regulation of Public Adjusters

Which individual would most likely be denied a Georgia public adjuster license based on character grounds?

  1. An applicant who was once cited for a minor traffic violation
  2. An applicant who filed personal bankruptcy eight years ago
  3. An applicant who previously worked for an insurer that was placed in rehabilitation
  4. An applicant convicted of felony insurance fraud five years ago Correct answer.

Explanation

A recent felony conviction involving fraud or dishonesty bears directly on fitness to handle claim funds and negotiations, and is a classic basis for denial. Bankruptcy, minor traffic citations, and prior employment with a troubled insurer are not character disqualifiers. The Department evaluates trustworthiness as it relates to insurance dealings.

Question 31Licensing and Regulation of Public Adjusters

A public adjuster licensed in another state wants to handle Georgia claims. Which statement about nonresident licensing is correct?

  1. The nonresident may adjust up to five Georgia claims per year without any license
  2. The nonresident may adjust Georgia claims if the home state has no public adjuster license
  3. The nonresident must obtain a Georgia nonresident public adjuster license and comply with Georgia law Correct answer.
  4. The nonresident's home-state license is void in Georgia and cannot support any application

Explanation

Georgia requires a nonresident public adjuster to be licensed in Georgia, typically through a nonresident application that relies on the home-state license where reciprocity or home-state licensure exists. A home-state license alone does not authorize Georgia claim work. There is no small-volume exemption, and the home-state license is not void; it supports the nonresident application.

Question 32Licensing and Regulation of Public Adjusters

A public adjuster's Georgia license is issued with an expiration date. Which statement about license term and renewal is correct?

  1. The license remains valid indefinitely once issued and requires no renewal
  2. The license must be renewed before expiration, and continuing education must be completed as required by the Department Correct answer.
  3. The license expires only if the adjuster changes employers
  4. The license renews automatically upon payment, with no continuing education requirement

Explanation

Georgia public adjuster licenses are term licenses that must be renewed, and renewal is conditioned on completing the continuing education the Department requires. Licenses do not remain valid indefinitely, renewal is not education-free, and a change of employer does not drive expiration. Failing to renew ends the authority to adjust.

Question 33Licensing and Regulation of Public Adjusters

A public adjuster moves and changes the business address on file with the Department. What is the adjuster's obligation?

  1. Notify only the insurers with which the adjuster has pending claims
  2. Wait until the next renewal to report the new address
  3. Notify the Department of the address change within the time required by rule Correct answer.
  4. Take no action because the license is tied to the adjuster, not an address

Explanation

Licensees must keep the Department's records current, which includes reporting a change of business address within the period set by rule. Deferring the report to renewal leaves the Department with inaccurate records. Insurers are not the licensing authority, and the license record does include address information.

Question 34Licensing and Regulation of Public Adjusters

A public adjuster's license has been revoked. Which statement best describes the effect on the adjuster's ability to work in Georgia?

  1. The adjuster may work only on commercial claims during the revocation
  2. The adjuster may work if a licensed adjuster signs the contracts
  3. The adjuster may not perform public adjusting until the Department restores the license Correct answer.
  4. The adjuster may continue working but must disclose the revocation to each client

Explanation

Revocation removes the authority to act as a public adjuster; the person cannot lawfully adjust claims for compensation until the Department restores the license. Disclosure to clients does not cure the lack of a license, and there is no commercial-claim exception. Having another licensee sign contracts does not launder unlicensed activity.

Question 35Licensing and Regulation of Public Adjusters

A public adjuster wants to use a trade name in advertising. Which approach complies with Georgia requirements?

  1. Use a trade name only if it is properly registered and disclosed to the Department as required Correct answer.
  2. Use a name suggesting a government agency to improve response rates
  3. Use a name that implies the adjuster works for the insurer to build trust
  4. Use any invented name as long as the adjuster's license number appears somewhere in the ad

Explanation

Trade names must be registered and disclosed as the Department requires, so the public can connect the name to the licensed person. A license number alone does not authorize an unregistered or misleading name. Names implying an insurer affiliation or government connection are deceptive and prohibited.

Question 36Licensing and Regulation of Public Adjusters

A public adjuster is approached by a homeowner whose claim the adjuster previously handled and closed. Which statement about re-engaging is most accurate?

  1. The adjuster may act without a contract because the parties have a prior relationship
  2. The original contract automatically covers any later claim on the same property
  3. The adjuster may reopen the file orally if the insured agrees by phone
  4. A new written contract is required before the adjuster performs additional adjusting services for compensation Correct answer.

Explanation

Compensation for public adjusting must rest on a current written contract that complies with the statute's content and cancellation requirements. A closed engagement does not automatically extend to new work, and an oral agreement does not satisfy the written-contract rule. A prior relationship does not waive the contract requirement.

Question 37Licensing and Regulation of Public Adjusters

Georgia limits how a public adjuster's compensation may be structured. Which compensation arrangement is consistent with that limit?

  1. A fee paid from the insured's mortgage escrow without the insured's knowledge
  2. A fee that does not exceed the statutory percentage of the insurance proceeds recovered Correct answer.
  3. A flat fee equal to the policy limit regardless of the amount recovered
  4. A contingency fee that increases as the negotiation continues past 60 days

Explanation

Georgia caps public adjuster compensation as a percentage of the amount actually recovered on the claim, which ties the fee to the benefit obtained. A fee unrelated to recovery, an escalating contingency, or a charge against escrow without the insured's knowledge does not fit that structure. The insured must understand and agree to the fee in writing.

Question 38Licensing and Regulation of Public Adjusters

A public adjuster receives a settlement check payable to the insured and the mortgagee. What is the adjuster's proper role?

  1. Withhold the check until the insured pays the adjuster's fee in cash
  2. Deposit the check into the adjuster's business account and disburse it later
  3. Help the insured understand the disbursement process without taking control of the funds Correct answer.
  4. Endorse the check on the insured's behalf to speed the process

Explanation

Settlement funds belong to the insured and the lienholder, and the public adjuster is not a party entitled to endorse or hold them. The adjuster may explain the process but cannot sign for the insured or route the money through a business account. Withholding a check to force payment is coercive and improper.

Question 39Licensing and Regulation of Public Adjusters

During a claim, the insured tells the public adjuster that a portion of the loss was caused intentionally by a family member. What is the adjuster's most appropriate course?

  1. Advise the insured to withdraw the claim and keep the matter private
  2. Omit the information from the claim submission to protect the insured
  3. Submit the claim as accidental and address the issue after payment
  4. Report the information accurately to the insurer and avoid concealing or misrepresenting it Correct answer.

Explanation

A public adjuster owes honesty to the insurer and cannot present a claim the adjuster knows to be false or conceal material facts. Omitting the information, advising concealment, or submitting a knowingly false claim exposes the insured and the adjuster to fraud consequences. The proper course is accurate presentation of the known facts.

Question 40Licensing and Regulation of Public Adjusters

A public adjuster wants to pay a referral fee to a roofing contractor who sends homeowners to the adjuster. Which statement is correct under Georgia rules?

  1. Paying for claim referrals is prohibited, and such arrangements can support discipline Correct answer.
  2. A referral fee is permitted if it does not exceed 10 percent of the adjuster's fee
  3. A referral fee is permitted if it is disclosed to the insured in writing
  4. A referral fee is permitted for commercial claims but not residential claims

Explanation

Georgia prohibits public adjusters from paying or sharing compensation for the referral of claims, because it creates incentives that harm insureds. Disclosure does not cure a prohibited payment, and no percentage threshold or commercial exception exists. Violations can support license discipline.

Question 41Licensing and Regulation of Public Adjusters

A public adjuster is hired by an insured and later learns the insurer has retained counsel and the insured has retained an attorney. How should the adjuster proceed?

  1. Ask the insured to dismiss the attorney so the adjuster can negotiate alone
  2. Coordinate with the insured's attorney and direct communications through counsel as appropriate Correct answer.
  3. Stop all work and forfeit the fee already earned
  4. Contact the insurer's counsel directly to negotiate outside the insured's attorney's knowledge

Explanation

When the insured is represented, the public adjuster should coordinate with the insured's attorney and respect the representation rather than bypassing it. Communicating with the insurer's counsel behind the insured's attorney's back undermines the insured's representation. Asking the insured to fire counsel is improper, and the adjuster need not abandon earned compensation.

Question 42Licensing and Regulation of Public Adjusters

A public adjuster asks an insured to sign a contract that omits the required notice of the right to cancel. What is the most likely consequence?

  1. The contract is valid because the insured signed voluntarily
  2. The contract may be unenforceable as to compensation, and the adjuster faces discipline Correct answer.
  3. The omission is cured if the adjuster explains cancellation orally
  4. The contract becomes valid after the first claim payment is received

Explanation

Georgia prescribes required contract terms, including the cancellation notice, and a contract missing them is vulnerable to being unenforceable and can support discipline against the adjuster. Voluntary signature does not waive statutory protections, an oral explanation does not substitute for the required writing, and later payment does not cure the defect.

Question 43Licensing and Regulation of Public Adjusters

Which activity by an unlicensed assistant working for a licensed public adjuster would require the assistant to be licensed?

  1. Negotiating settlement figures with the insurer on the insured's behalf Correct answer.
  2. Answering the office telephone and taking messages
  3. Delivering documents to the insurer's office
  4. Photocopying a policy for the claim file

Explanation

Negotiating a claim on behalf of an insured for compensation is the core licensed activity, and an unlicensed assistant cannot perform it. Clerical and courier tasks such as delivering documents, answering phones, and copying records do not themselves constitute adjusting. The licensed adjuster remains responsible for the claim.

Question 44Licensing and Regulation of Public Adjusters

A public adjuster maintains claim files. Which practice best supports compliance with Georgia recordkeeping expectations?

  1. Keep only the signed contract and discard correspondence and estimates
  2. Store records only on a personal device with no backup
  3. Destroy files 30 days after the claim closes to protect client privacy
  4. Retain complete claim records for the period required and make them available to the Department on request Correct answer.

Explanation

Public adjusters must keep complete records of each engagement for the required retention period and produce them when the Department examines the business. Early destruction, discarding substantive claim documents, or unbacked personal storage undermines both the record requirement and the ability to respond to an examination.

Question 45Licensing and Regulation of Public Adjusters

The Department opens an examination of a licensed public adjuster's business. Which statement about the adjuster's response is correct?

  1. The adjuster may refuse because the records are private business property
  2. The adjuster must produce the requested business records and cooperate with the examination Correct answer.
  3. The adjuster may delay indefinitely while the license remains active
  4. The adjuster may produce records only if the insurer consents

Explanation

Holding a license subjects the adjuster to the Department's examination authority, including production of business records relevant to adjusting activity. Privacy claims, insurer consent, and indefinite delay do not override that authority. Refusal to cooperate can itself support disciplinary action.

Question 46Licensing and Regulation of Public Adjusters

A public adjuster is convicted of a misdemeanor involving dishonesty in a matter unrelated to insurance. What is the most likely regulatory significance?

  1. It requires only that the adjuster retake the licensing examination
  2. It automatically voids the license without any Department proceeding
  3. It has no significance because it is a misdemeanor and unrelated to insurance
  4. It may be considered in a disciplinary proceeding because it bears on trustworthiness Correct answer.

Explanation

The Department evaluates licensee conduct for honesty and trustworthiness, and a dishonesty-related conviction can be considered in discipline even outside insurance. Such a conviction does not automatically void a license without a proceeding, and retaking an examination is not the remedy for a conduct issue.

Question 47Licensing and Regulation of Public Adjusters

A public adjuster's license is placed on probation with conditions. Which statement best describes the adjuster's status?

  1. The adjuster must surrender the license permanently
  2. The adjuster's authority is fully suspended for the probation term
  3. The adjuster may ignore the conditions if the insureds do not object
  4. The adjuster may continue adjusting while complying with the conditions imposed in the order Correct answer.

Explanation

Probation permits continued practice subject to the conditions the Department imposes, such as reporting, supervision, or education. It is not a suspension, so authority is not fully removed, and the conditions are binding regardless of client views. Permanent surrender is a different sanction.

Question 48Licensing and Regulation of Public Adjusters

A public adjuster wants to charge an insured a fee before any settlement is reached, based on time spent. Which statement is most accurate?

  1. Any fee is permissible if the insured agrees in writing
  2. The fee must conform to the statutory compensation structure stated in the written contract Correct answer.
  3. The adjuster may bill hourly as long as the rate is disclosed
  4. The adjuster may set the fee after the claim closes without prior agreement

Explanation

Compensation must follow the statutory structure and be set out in the written contract before work begins. Written agreement alone cannot authorize a fee that conflicts with the statute, and hourly billing outside that structure is not permitted. Setting the fee after the fact defeats informed consent.

Question 49Licensing and Regulation of Public Adjusters

Which statement correctly describes a public adjuster's duty when soliciting a homeowner immediately after a loss?

  1. The adjuster may state that the adjuster represents the insurer to gain access
  2. The adjuster may sign the contract on the homeowner's behalf
  3. The adjuster must not misrepresent the adjuster's role or pressure the homeowner into signing Correct answer.
  4. The adjuster may begin negotiating before any written contract exists

Explanation

Solicitation must be truthful and free of misrepresentation or high-pressure tactics, and the adjuster must make clear that the adjuster represents the insured, not the insurer. Signing for the homeowner is unauthorized, and negotiating before a written contract violates the contract requirement.

Question 50Licensing and Regulation of Public Adjusters

A public adjuster's license lapses for nonrenewal while a claim is pending. What is the adjuster's most appropriate action?

  1. Continue the pending claim because it began while the license was active
  2. Stop adjusting activity and resolve the license status before continuing work on the claim Correct answer.
  3. Complete the claim and report the lapse at the next renewal cycle
  4. Transfer the claim to an unlicensed assistant until renewal is complete

Explanation

Once the license lapses, the adjuster lacks authority to continue adjusting, even on a claim opened earlier. Prior licensure does not carry forward permission, and delegating to an unlicensed assistant compounds the violation. The lapse must be resolved before adjusting resumes.