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KS Public Adjuster practice questions

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Question 1Kansas insurance law, regulation, and public adjuster licensing requirements

In Kansas, a person who wants to negotiate first-party property claims on behalf of insureds for a fee must obtain a public adjuster license from which authority?

  1. The Kansas Attorney General.
  2. The Kansas Insurance Commissioner. Correct answer.
  3. The Kansas Secretary of State.
  4. The district court in the county where the claim arose.

Explanation

Public adjuster licensing is administered by the Kansas Insurance Department under the Commissioner of Insurance. The Commissioner has authority to issue, deny, suspend, and revoke public adjuster licenses. The other offices listed do not license public adjusters.

Question 2Kansas insurance law, regulation, and public adjuster licensing requirements

For purposes of Kansas public adjuster regulation, a public adjuster is best described as a person who does which of the following?

  1. Represents an insurer in evaluating coverage and setting reserves.
  2. Serves only as an attorney representing an insured in litigation against an insurer.
  3. Works exclusively for a contractor to estimate repair costs for an insured.
  4. For compensation, represents an insured in negotiating or settling a first-party claim. Correct answer.

Explanation

The definition turns on acting for compensation on behalf of the insured in negotiating or settling a claim. Insurer-side staff adjusters, attorneys, and contractors are regulated differently. A public adjuster's role is to represent the policyholder's interests in the claim.

Question 3Kansas insurance law, regulation, and public adjuster licensing requirements

Before a Kansas public adjuster begins representing an insured on a claim, the adjuster must do which of the following?

  1. Have a written contract signed by the insured that discloses the adjuster's compensation. Correct answer.
  2. Collect the full fee in advance from the insured.
  3. File a copy of the representation notice with the Commissioner in every claim.
  4. Obtain the insurer's written consent to the representation.

Explanation

Kansas public adjuster contracts must be in writing, signed by the insured, and must disclose the adjuster's compensation and other required terms. The adjuster does not need the insurer's consent, and no claim-by-claim filing with the Commissioner is required. Advance collection of the full fee is not a prerequisite.

Question 4Kansas insurance law, regulation, and public adjuster licensing requirements

A licensed Kansas public adjuster is retained by an insured after a fire loss. The insurer later offers to pay the same adjuster a separate fee to evaluate the claim for the insurer. What is the adjuster's proper response?

  1. Accept the insurer's fee because dual compensation is allowed for licensed adjusters.
  2. Accept the insurer's fee if the insured gives verbal approval.
  3. Accept the insurer's fee and reduce the insured's fee by the same amount.
  4. Decline the insurer's fee because representing both the insured and insurer on the same claim creates a prohibited conflict. Correct answer.

Explanation

A public adjuster owes loyalty to the insured and cannot serve both sides of the same claim. Accepting compensation from the insurer would create a conflict of interest that disclosure or a fee reduction does not cure. The adjuster should decline the insurer's offer.

Question 5Kansas insurance law, regulation, and public adjuster licensing requirements

After a hailstorm, an unlicensed person tells a homeowner that he will negotiate the roof claim with the insurer for 15 percent of whatever the insurer pays. Under Kansas law, this arrangement is best characterized as which of the following?

  1. Permissible because the fee is contingent on a settlement.
  2. Unlawful unless the person is licensed as a public adjuster. Correct answer.
  3. Permissible because the homeowner solicited the help.
  4. Unlawful only if the person signs a contract with the insurer.

Explanation

Acting for compensation on behalf of an insured to negotiate a first-party claim requires a public adjuster license. A contingent fee and the fact that the homeowner sought help do not create an exception. The violation arises from unlicensed public adjusting, not from signing a contract with the insurer.

Question 6Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster contract includes the required notice that the insured may rescind the agreement within the statutory period. If the insured timely rescinds, which result follows?

  1. The adjuster may enforce the fee because the contract was signed.
  2. The contract is canceled and the adjuster may not collect compensation under it. Correct answer.
  3. The adjuster may keep any fee already paid plus a cancellation penalty.
  4. The insurer must pay the adjuster's fee as a claim expense.

Explanation

A timely rescission cancels the public adjuster contract under the statutory right. The adjuster may not enforce the fee or impose a penalty for exercising that right. The insurer is not responsible for paying the adjuster's fee as a claim expense.

Question 7Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster wants to build referral relationships. Which arrangement is consistent with public adjuster licensing law?

  1. Compensating only licensed public adjusters for claim-related work under the contract. Correct answer.
  2. Paying a per-claim bounty to an unlicensed public adjuster trainee.
  3. Sharing part of the adjuster's fee with an unlicensed contractor who referred the insured.
  4. Paying the insured a rebate from the adjuster's fee for signing the contract.

Explanation

Public adjusters may not share compensation with unlicensed persons for referrals or claim work. Paying licensed public adjusters for claim-related services under the contract is the permissible arrangement among these choices. Rebates to insureds and bounties to unlicensed trainees are not allowed.

Question 8Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster negotiates a settlement and receives a settlement check payable to the insured and the mortgage company. The insured asks the adjuster to deposit the check in the adjuster's business account and pay the insured's share after deducting the fee. Which statement is legally correct?

  1. The adjuster may endorse the mortgage company's name because the policyholder authorized it.
  2. The adjuster may deposit and disburse the funds if the fee is disclosed in the contract.
  3. The adjuster may keep the entire check until the insurer confirms the settlement amount.
  4. The adjuster must handle claim funds as fiduciary funds and may not commingle them with the adjuster's own operating funds. Correct answer.

Explanation

A public adjuster who handles claim proceeds owes a fiduciary duty to the insured and other payees. Claim funds must be safeguarded and may not be commingled with the adjuster's business operating funds. The adjuster also cannot endorse another payee's name without proper authority.

Question 9Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster license application is denied by the Commissioner. Which statement best describes the applicant's recourse?

  1. The applicant must seek a public adjuster license from the county clerk instead.
  2. The applicant may act as a public adjuster while an appeal is pending.
  3. The applicant may request a hearing under Kansas insurance licensing procedures and seek judicial review after exhausting administrative remedies. Correct answer.
  4. The denial is final and cannot be reviewed by any tribunal.

Explanation

A denial of a Kansas insurance license is subject to administrative hearing procedures and, after exhaustion, judicial review. The applicant may not act as a public adjuster while the denial is pending. County clerks do not issue public adjuster licenses.

Question 10Kansas insurance law, regulation, and public adjuster licensing requirements

Which qualification is most directly tied to obtaining an initial Kansas public adjuster license?

  1. Passing the public adjuster licensing examination required by the Commissioner. Correct answer.
  2. Residence in the county where the first claim will be handled.
  3. Membership in the Kansas Bar Association.
  4. Five years of experience as an insurance company staff adjuster.

Explanation

Initial public adjuster licensure in Kansas requires meeting the Commissioner's application requirements, including passing the required licensing examination. Bar membership, prior insurer-side adjusting experience, and county residence are not the stated qualification tested here. The examination requirement applies to new applicants.

Question 11Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster is preparing a written agreement to represent an insured on a commercial property claim. Which item must the agreement disclose?

  1. The fee or compensation method Correct answer.
  2. The name of the insurer's assigned defense attorney
  3. The insurer's internal claim reserve for the loss
  4. A waiver of all policy deadlines by the insured

Explanation

Kansas requires public adjuster representation agreements to be in writing and to state the compensation the adjuster will receive or the method for calculating it. The insurer's reserves, defense counsel, and policy deadlines are not contract terms the adjuster may waive for the insured.

Question 12Kansas insurance law, regulation, and public adjuster licensing requirements

Which Kansas official or office issues a public adjuster license?

  1. The Kansas Attorney General
  2. The Kansas Commissioner of Insurance Correct answer.
  3. The county district court where the insured resides
  4. The Kansas Department of Labor

Explanation

Public adjuster licensing is administered by the Kansas Commissioner of Insurance under the state's insurance laws. The Commissioner receives applications, makes licensing determinations, and may discipline licensees.

Question 13Kansas insurance law, regulation, and public adjuster licensing requirements

After a Kansas public adjuster and an insured sign a representation contract, what must the adjuster do with the contract?

  1. Record it with the county register of deeds
  2. Send it to the Kansas Commissioner for prior approval
  3. File the original with the insurer before negotiating
  4. Give the insured a copy of the signed contract Correct answer.

Explanation

Kansas requires the public adjuster contract to be written and signed, and the insured must receive a copy. Filing with the insurer, Commissioner approval, and county recording are not prerequisites to the representation.

Question 14Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster completes a claim for an insured. For how long must the adjuster keep records of the claim transactions?

  1. Until the insurer pays the claim
  2. At least five years Correct answer.
  3. One year after the claim is closed
  4. Two years after the policy expires

Explanation

Kansas public adjuster recordkeeping rules require a licensee to keep claim and transaction records for at least five years. The records must be available for examination by the Commissioner.

Question 15Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster is asked to represent an insured on a claim being handled for the insurer by the adjuster's spouse. What should the public adjuster do?

  1. Accept and disclose the relationship after settlement
  2. Decline the representation because of the conflict of interest Correct answer.
  3. Accept because Kansas licenses regulate only the public adjuster's own conduct
  4. Accept only if the spouse agrees not to discuss the claim

Explanation

A public adjuster owes loyalty to the insured and must avoid conflicts that could compromise representation. A spouse's role as the insurer's adjuster on the same claim creates an impermissible conflict; disclosure after settlement does not cure it.

Question 16Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster receives a settlement payment for an insured and deposits it in the adjuster's general business account. What is the primary problem with this practice?

  1. Client funds must be kept separate and accounted for Correct answer.
  2. Settlement funds may only be deposited in the insurer's account
  3. The adjuster must wait until the policy period ends before depositing funds
  4. The adjuster has not first obtained the Commissioner's approval of the deposit

Explanation

A public adjuster handling money for an insured acts in a fiduciary capacity. Settlement funds must not be commingled with the adjuster's operating funds and must be promptly and accurately accounted for.

Question 17Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster contacts homeowners after a storm and states, "I am with your insurance company and have been assigned to handle your claim." What violation does this illustrate?

  1. Charging an excessive fee without written disclosure
  2. Soliciting without a county permit
  3. Misrepresenting the adjuster's relationship with the insurer Correct answer.
  4. Failing to maintain five years of claim records

Explanation

A public adjuster represents the insured, not the insurer, and may not falsely imply authority from or affiliation with the insurer. Misrepresentation in claim solicitation is prohibited conduct and can support disciplinary action.

Question 18Kansas insurance law, regulation, and public adjuster licensing requirements

The Kansas Commissioner of Insurance determines that a person is negotiating property claims for a fee without a public adjuster license. Which action may the Commissioner take?

  1. Refer the matter to the county register of deeds for recording
  2. Issue a cease and desist order and seek authorized penalties Correct answer.
  3. Require the person to join a trade association
  4. Issue a certificate of authority retroactive to the first claim

Explanation

Unlicensed public adjusting is prohibited, and the Commissioner may use enforcement tools such as cease and desist orders and penalties. The Commissioner does not cure unlicensed activity by backdating authority or referring the matter to a recording office.

Question 19Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster's license is revoked while the adjuster is representing several insureds. What is the effect on those representations?

  1. The adjuster may finish only claims filed before the revocation
  2. The adjuster may continue if each insured signs a waiver
  3. The adjuster may not continue negotiating claims for compensation Correct answer.
  4. The adjuster may continue under the insurer's supervision

Explanation

Revocation removes the legal authority to act as a public adjuster, so the licensee cannot continue negotiating claims for compensation. Existing clients must be transitioned, and a waiver from insureds cannot restore a revoked license.

Question 20Kansas insurance law, regulation, and public adjuster licensing requirements

An insured asks a Kansas public adjuster, "Can you guarantee that the insurer will pay my full policy limit?" What is the most appropriate response?

  1. No, the adjuster can advocate but cannot guarantee the insurer's decision Correct answer.
  2. No, unless the Commissioner approves the guarantee in advance
  3. Yes, because a licensed public adjuster can bind the insurer to the policy limit
  4. Yes, if the adjuster includes the guarantee in the written contract

Explanation

A public adjuster advocates for the insured but does not have authority to bind the insurer or promise a particular claim outcome. Promising a guaranteed settlement amount would misrepresent the adjuster's role and could be prohibited conduct.

Question 21Kansas insurance law, regulation, and public adjuster licensing requirements

Kansas public adjuster licensing rules carve out an exception for which person who is acting within the scope of the person's professional practice?

  1. A roofing contractor who negotiates the insured's claim for a fee
  2. A claim service that charges the insured a contingency fee
  3. A restoration firm that negotiates the claim as part of its repair contract
  4. A licensed Kansas attorney representing an insured in a claim dispute Correct answer.

Explanation

Kansas law exempts licensed attorneys acting within the practice of law from the public adjuster licensing requirement. Paid claim consultants, contractors, and restoration firms that negotiate claims for compensation are not within that attorney exemption. The other choices describe compensated claim negotiation or repair work, not protected legal representation.

Question 22Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster has a written contract to represent an insured for a percentage of the settlement. The insurer offers to pay the adjuster a separate fee to move the claim quickly. What does Kansas law require the adjuster to do?

  1. Decline the insurer's fee and look only to the insured for compensation Correct answer.
  2. Accept the insurer's fee if the insured's fee is reduced by the same amount
  3. Accept the fee only after the insured signs a settlement release
  4. Accept the fee if the adjuster discloses it to the insured in writing

Explanation

Kansas prohibits a public adjuster from being compensated by both the insured and the insurer on the same claim. A separate insurer payment creates a conflict and is not cured by disclosure or by reducing the insured's fee. The adjuster must look solely to the insured under the public adjuster contract.

Question 23Kansas insurance law, regulation, and public adjuster licensing requirements

A licensed Kansas public adjuster sells the adjusting business to another person. What is the effect on the seller's public adjuster license?

  1. It remains personal to the seller and is not transferred by the sale Correct answer.
  2. It automatically transfers with the business if the buyer pays the transfer fee
  3. It transfers if the Commissioner of Insurance approves the sale
  4. It becomes inactive until the buyer obtains a new license

Explanation

A public adjuster license is a personal license issued to the individual based on that person's qualifications. Selling the business does not transfer the license, and the buyer must qualify for a license in the buyer's own right. Commissioner approval of a business sale does not convert the license into a transferable asset.

Question 24Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster owns a 40 percent interest in a roofing company. The insured's hail claim needs roof repairs. Which action is prohibited for the adjuster?

  1. Referring the insured to the adjuster's roofing company Correct answer.
  2. Explaining replacement-cost coverage to the insured
  3. Recommending that the insured seek several repair bids
  4. Giving the insurer photographs of the damaged roof

Explanation

Kansas public adjuster rules prohibit an adjuster from referring an insured to a repair business in which the adjuster has a financial interest. The conflict exists because the adjuster could benefit from the repair contract while also negotiating the claim. Photographs, coverage explanations, and advice to obtain independent bids are ordinary claim-handling activities.

Question 25Kansas insurance law, regulation, and public adjuster licensing requirements

A public adjuster who is licensed and in good standing in Missouri wants to negotiate a Kansas property claim for a Kansas insured. What must the adjuster obtain before acting?

  1. A written waiver from the insured's insurer
  2. A Kansas insurance producer license
  3. A Kansas contractor's registration
  4. A Kansas nonresident public adjuster license Correct answer.

Explanation

Kansas requires a public adjuster license to negotiate Kansas claims for compensation, and a Missouri license alone does not authorize Kansas activity. A nonresident may apply for a Kansas nonresident public adjuster license if the adjuster meets Kansas requirements. Producer or contractor licenses do not authorize public adjusting.

Question 26Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster license is subject to biennial renewal. That means the licensee must renew the license how often?

  1. Every three years
  2. Only when the Commissioner requests a renewal
  3. Every two years Correct answer.
  4. Every year

Explanation

Kansas public adjuster licenses are renewed on a biennial cycle, so the licensee must renew every two years. Renewal keeps the license active for continued claim negotiation; it is not tied to a Commissioner's discretionary request. Annual, three-year, and request-only renewal schedules do not match the biennial term.

Question 27Kansas insurance law, regulation, and public adjuster licensing requirements

A Kansas public adjuster moves the adjuster's business office to a new address. What is the adjuster required to do with respect to the Commissioner of Insurance?

  1. Wait until the next license renewal to report the new address
  2. Ask the Commissioner to reissue the license under a new name
  3. File a notice of the address change with the Commissioner Correct answer.
  4. Notify only the insureds with open claims

Explanation

A licensed public adjuster must keep the Commissioner informed of a change in business address so licensing records and service of process remain current. Reporting only to clients or waiting for renewal does not satisfy that regulatory duty. The license is not automatically reissued under a new name because the licensee moved.

Question 28Kansas insurance law, regulation, and public adjuster licensing requirements

An insured asks a Kansas public adjuster to interpret the legal effect of a policy exclusion and to draft a lawsuit against the insurer. What is the adjuster's proper response?

  1. Tell the insured that public adjusters may practice law after a denial
  2. Draft the lawsuit but refuse to sign it for the insured
  3. Explain coverage observations and advise the insured to consult an attorney Correct answer.
  4. Provide the legal interpretation and draft the lawsuit as claim representation

Explanation

Public adjusters may explain coverage and negotiate claims, but they are not licensed to give legal opinions or draft litigation. When an insured needs legal interpretation or a lawsuit, the adjuster should advise the insured to consult a licensed attorney. Claim representation does not expand the adjuster's license into the practice of law.

Question 29Kansas insurance law, regulation, and public adjuster licensing requirements

An insurer sends a full-release form to a Kansas public adjuster for an insured's property claim. The insured has not given the adjuster written authority to execute the release. What may the adjuster do?

  1. Sign the release and later obtain the insured's ratification
  2. Decline to sign and give the release to the insured for a decision Correct answer.
  3. Sign the release if it matches the adjuster's estimate
  4. Sign the release because the license allows binding the insured

Explanation

A public adjuster negotiates on the insured's behalf but does not automatically have authority to sign a release that binds the insured. Absent written authority from the insured, the adjuster should not execute the release. The insured must make the settlement decision, and later ratification is not a substitute for prior authority.

Question 30Kansas insurance law, regulation, and public adjuster licensing requirements

The Kansas Commissioner of Insurance opens an inquiry into a public adjuster's claim handling and asks for the adjuster's claim files. The adjuster refuses, citing client confidentiality. How should this be resolved?

  1. The adjuster may refuse until the insured consents in writing
  2. The adjuster may refuse because claim files are privileged client property
  3. The adjuster must produce the records to the Commissioner under the insurance laws Correct answer.
  4. The adjuster must produce only files for closed claims

Explanation

Public adjusters are subject to the Commissioner's examination and investigatory authority, including production of claim records relevant to an inquiry. Client confidentiality does not override a lawful request from the insurance regulator. Refusing to produce records can lead to disciplinary action.

Question 31Ethics, fiduciary duty, and prohibited acts for public adjusters

In Kansas, when a public adjuster contracts to handle a first-party property claim, the adjuster owes the fiduciary duty primarily to which party?

  1. The insured who signed the public adjuster contract Correct answer.
  2. The insurer that issued the property policy
  3. The mortgagee named on the policy
  4. The Commissioner of Insurance

Explanation

The public adjuster is the insured's representative, not the insurer's, and must act with loyalty and good faith in the insured's interest. The Commissioner is a regulator, and a mortgagee may have a financial interest but is not the client to whom the primary duty runs.

Question 32Ethics, fiduciary duty, and prohibited acts for public adjusters

Under Kansas public adjuster rules, a public adjuster may collect compensation for adjusting an insured's claim only when the adjuster has first:

  1. filed a fee schedule with the Commissioner
  2. obtained the insurer's written consent to the fee
  3. received a settlement offer from the insurer
  4. entered into a written contract with the insured Correct answer.

Explanation

Kansas requires a written, signed contract before a public adjuster may charge or receive compensation. Insurer consent, a filed fee schedule, or a settlement offer does not substitute for the insured's written agreement.

Question 33Ethics, fiduciary duty, and prohibited acts for public adjusters

A Kansas public adjuster represents an insured on a fire loss and also accepts a consulting payment from the insurer for the same claim. This conduct is best characterized as:

  1. permissible if the insured receives a larger settlement
  2. permissible if the adjuster discloses it after settlement
  3. prohibited dual compensation and a conflict of interest Correct answer.
  4. prohibited only when the insurer pays more than the insured

Explanation

A public adjuster cannot accept compensation from both the insured and the insurer for the same claim; doing so creates an impermissible conflict of interest. Later disclosure or a larger settlement does not cure the dual role.

Question 34Ethics, fiduciary duty, and prohibited acts for public adjusters

While firefighters are still extinguishing a kitchen fire at a policyholder's home, a licensed public adjuster approaches the homeowner on the lawn and offers to handle the claim. Under Kansas public adjuster ethics rules, this solicitation is:

  1. improper only if the adjuster demands a fee that day
  2. proper if the adjuster gives the homeowner a business card
  3. improper because it occurs during a loss-producing occurrence Correct answer.
  4. proper because the adjuster is licensed and the claim is fresh

Explanation

Kansas prohibits a public adjuster from soliciting a client during the progress of a loss-producing occurrence. The prohibition protects distressed insureds from being pressured while the emergency is ongoing, even if the adjuster is licensed.

Question 35Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster advertises under the name "Kansas State Claims Adjusters" and tells homeowners that the firm is "the official state office for storm claims." This conduct violates Kansas public adjuster standards because it:

  1. implies a government affiliation that does not exist Correct answer.
  2. targets storm victims instead of all insureds
  3. uses the word "claims" in a business name
  4. fails to include the adjuster's license number in the ad

Explanation

Public adjusters may not use business names or advertising that falsely suggest a connection with the state or a government agency. The problem is the implied official status, not the word "claims" or the targeted marketing itself.

Question 36Ethics, fiduciary duty, and prohibited acts for public adjusters

An insured signs a public adjuster contract and then rescinds it during the rescission period set by Kansas law. What must the public adjuster do?

  1. Continue work until the insurer approves cancellation
  2. Keep any retainer as liquidated damages
  3. Convert the contract to a contingency fee agreement
  4. Cancel the contract and refund any fee paid Correct answer.

Explanation

When an insured rescinds a public adjuster contract within the statutory rescission period, the contract is canceled and the adjuster must refund fees paid. The adjuster cannot keep a retainer as damages or continue work without a valid contract.

Question 37Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster recommends a restoration contractor to an insured and secretly receives $750 from the contractor for each referral. The adjuster has not disclosed the payment. Which statement best describes this arrangement under Kansas public adjuster ethics?

  1. It is prohibited as an undisclosed conflict of interest. Correct answer.
  2. It is allowed if the contractor's work is satisfactory.
  3. It is prohibited only if the insured pays a fee.
  4. It is allowed if the fee is paid after the claim closes.

Explanation

Accepting an undisclosed payment from a contractor for a referral creates a conflict between the adjuster's duty of loyalty to the insured and the adjuster's financial interest. The insured is entitled to know about any such relationship, and secret referral fees are prohibited.

Question 38Ethics, fiduciary duty, and prohibited acts for public adjusters

An insurer issues a settlement check payable to the insured and the mortgagee. The insured asks the public adjuster to endorse the check so the adjuster can deposit it and deduct the fee. What should the adjuster do?

  1. Endorse the check and deposit it in the adjuster's business account
  2. Decline to endorse the check and let the insured handle it Correct answer.
  3. Deduct the fee and send the balance to the contractor
  4. Hold the check until the mortgagee signs a release

Explanation

Settlement drafts payable to the insured and mortgagee must be handled by those parties; a public adjuster should not endorse or deposit them. The adjuster's fee is collected under the written contract, not by diverting claim proceeds.

Question 39Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster has represented an insured through negotiation of a hail claim. The insurer later asks the same adjuster to serve as its paid consultant on that claim. Under Kansas public adjuster ethics, the adjuster should:

  1. accept if the insurer pays a higher hourly rate
  2. accept only if the adjuster discloses the role to the Commissioner
  3. decline because representing both sides of the same claim is a conflict Correct answer.
  4. accept if the insured consents in writing after settlement

Explanation

A public adjuster who has represented the insured cannot later serve the insurer on the same claim; that is a prohibited dual representation and conflict of interest. Written consent or disclosure to the Commissioner does not remove the conflict.

Question 40Ethics, fiduciary duty, and prohibited acts for public adjusters

A Kansas public adjuster wants to pay a roofing salesperson $200 for each homeowner the roofer sends to the adjuster. The roofer holds no public adjuster or insurance license. This payment arrangement is:

  1. prohibited only when the roofer also performs repairs
  2. acceptable if the roofer only sends homeowners with active leaks
  3. prohibited as payment to an unlicensed solicitor Correct answer.
  4. acceptable if the $200 is disclosed in the adjuster's contract

Explanation

Public adjusters may not pay commissions or fees to unlicensed persons for soliciting insurance claims. The rule prevents unlicensed salespeople from doing the work that requires a public adjuster license and protects consumers from improper solicitation.

Question 41Ethics, fiduciary duty, and prohibited acts for public adjusters

A Kansas public adjuster meets a homeowner at a coffee shop and agrees to handle a water-damage claim for 10% of the settlement. The homeowner says, 'That's fine, let's start today.' What does Kansas law require before the adjuster may begin work?

  1. An email from the insurer approving the fee.
  2. A written contract signed by the insured. Correct answer.
  3. A verbal agreement witnessed by one person.
  4. A notarized power of attorney filed with the state.

Explanation

Kansas requires public adjuster contracts to be in writing and signed by the insured, with required disclosures such as compensation and rescission rights. A verbal agreement, insurer email, or power of attorney does not substitute for the statutory contract.

Question 42Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster's Kansas license is suspended for failing to complete continuing education. The adjuster continues to negotiate a pending claim and collects a fee. Which statement is correct?

  1. The adjuster may finish the claim because it began before the suspension.
  2. The adjuster may collect a fee if the insurer approves the arrangement.
  3. The adjuster is engaged in unlicensed public adjusting and may not collect a fee. Correct answer.
  4. The adjuster may finish only if supervised by another licensed adjuster.

Explanation

A public adjuster must hold an active Kansas license while adjusting claims and collecting compensation. A suspended license bars all public adjusting activity, and supervision by another adjuster does not cure the defect.

Question 43Ethics, fiduciary duty, and prohibited acts for public adjusters

After an insured signs a public adjuster contract, what must the public adjuster do regarding the contract document?

  1. Send the original contract to the insurer for approval.
  2. File the contract with the Kansas Insurance Department within ten days.
  3. Provide the insured with a copy of the signed contract. Correct answer.
  4. Retain the only signed copy in the adjuster's file.

Explanation

The Act requires the public adjuster to give the insured a copy of the signed contract. Retaining the only copy, sending the original to the insurer, or filing it with the Department does not satisfy that duty.

Question 44Ethics, fiduciary duty, and prohibited acts for public adjusters

A Kansas public adjuster receives a $25,000 settlement draft payable to the insured. The adjuster deposits it into a personal account, pays office expenses, and sends the remainder two weeks later. What is the primary violation?

  1. No violation if the adjuster records the deposit in a ledger.
  2. A violation only if the insured did not consent to the delay.
  3. No violation because the draft was payable to the insured.
  4. A breach of fiduciary duty through commingling claim funds with personal funds. Correct answer.

Explanation

A public adjuster holds settlement funds in a fiduciary capacity and must not commingle them with personal or operating funds. Using claim money for office expenses and delaying payment to the insured is a breach and potential conversion.

Question 45Ethics, fiduciary duty, and prohibited acts for public adjusters

To persuade a homeowner to sign a public adjuster contract, the adjuster says, 'Your policy definitely covers this mold loss, and the insurer has no legal basis to deny it.' The policy contains a clear mold exclusion. What prohibited act has occurred?

  1. Sharing the fee with a person who is not licensed.
  2. Rebating a portion of the public adjuster fee to the insured.
  3. Soliciting the insured during a declared state of emergency.
  4. Misrepresenting policy coverage to induce the insured to sign the contract. Correct answer.

Explanation

A public adjuster may not misrepresent policy provisions, coverage, or the insurer's obligations to obtain or retain a client. A definite coverage promise that contradicts a clear exclusion is a prohibited misrepresentation even if the adjuster hopes the insurer will pay.

Question 46Ethics, fiduciary duty, and prohibited acts for public adjusters

A Kansas public adjuster contract includes a clause stating that the insured waives any right to cancel the agreement after signing. How should that clause be treated?

  1. Void, because the insured's statutory rescission right cannot be waived. Correct answer.
  2. Valid, but only if the claimed loss is below $10,000.
  3. Valid, but only if the adjuster explains the clause orally.
  4. Enforceable, because the insured signed and initialed the clause.

Explanation

Kansas public adjuster contracts must give the insured a right to rescind within the statutory period. A clause purporting to waive that right is void because it conflicts with the statute.

Question 47Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster uses an unlicensed assistant to call the insurer, negotiate the settlement amount, and agree to a final figure. The adjuster reviews the file afterward. What is the violation?

  1. None, because the licensed adjuster reviewed the file afterward.
  2. The assistant's negotiation violates the Act because only a licensed public adjuster may negotiate. Correct answer.
  3. The arrangement is allowed if the insurer does not object to speaking with the assistant.
  4. None, because the assistant performed only clerical work.

Explanation

Only a licensed public adjuster may negotiate a claim on behalf of an insured. An unlicensed assistant may perform clerical tasks, but negotiating the settlement and binding the insured exceeds that role.

Question 48Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster obtains the insured's medical and financial records for a fire claim and shares them with a marketing vendor without the insured's consent. What is the ethical characterization of this conduct?

  1. A breach of the fiduciary duty of confidentiality owed to the insured. Correct answer.
  2. Permitted if the vendor signs a confidentiality agreement.
  3. Permitted because the records relate to the claim being adjusted.
  4. Prohibited only for medical records, not for financial records.

Explanation

The fiduciary relationship includes a duty to protect the insured's confidential information. Sharing claim-related financial or medical records with a marketing vendor without consent breaches that duty, even if the vendor signs a confidentiality agreement.

Question 49Ethics, fiduciary duty, and prohibited acts for public adjusters

An insured tells the public adjuster that a damaged rug was actually undamaged and that the receipt is fake. The adjuster includes the rug in the claim because 'the insurer will never inspect it.' What is the adjuster's ethical violation?

  1. Charging a contingent fee instead of an hourly fee.
  2. Failing to provide the insured a copy of the contract.
  3. Soliciting the insured during an emergency.
  4. Submitting or aiding a false or inflated claim. Correct answer.

Explanation

A public adjuster may not present or assist in presenting a claim the adjuster knows is false or inflated. Including known false items to obtain a settlement violates the adjuster's duty of honesty and exposes the adjuster to fraud liability.

Question 50Ethics, fiduciary duty, and prohibited acts for public adjusters

A public adjuster prepares a sworn proof of loss that lists the adjuster's own $3,000 fee as part of the dwelling damage. The insurer pays it within the policy limits. What is the primary ethical problem?

  1. The adjuster misrepresented the claim by including compensation as covered damage. Correct answer.
  2. The adjuster may include the fee if the insured agrees orally.
  3. The adjuster should have listed the fee as a separate claim.
  4. The fee is too low to be enforceable under Kansas law.

Explanation

Public adjuster compensation is not a covered loss and may not be presented as part of the insured's property damage. Including the fee in a proof of loss inflates the claim and misrepresents the amount of damage to the insurer.