Free MI-ADJ Practice Questions

Question 1

A driver swerves to avoid a deer, never contacts the animal, and strikes a guardrail. The Michigan auto policy provides broad form collision with a $1,000 deductible and other-than-collision coverage with a $250 deductible. The investigation establishes that the driver was 70% at fault. How should the guardrail damage to the insured vehicle be classified?

Accepted Answer

Broad form collision, with the $1,000 collision deductible.

Answer

Other than collision, with the $250 deductible, because an animal prompted the maneuver.

Answer

Broad form collision, without a deductible, because no other vehicle was involved.

Answer

No collision payment, because the driver was more than 50% responsible for the accident.

Question 2

An accepted Michigan work injury leaves an employee unable to work. The verified gross average weekly wage is $1,500; the statutory after-tax average weekly wage is $1,125. The employee's usual payroll deposit was only $950 because of additional voluntary deductions. For a full compensable week in 2026, no offsets or age reductions apply, and the weekly maximum is $1,201. What wage-loss benefit is due?

Accepted Answer

$900

Answer

$760

Answer

$1,000

Answer

$1,200

Question 3

From the top of a basement stairway, an adjuster sees standing water reaching electrical outlets. Power has not been disconnected, and reaching the main breaker would require entering the water. The homeowner offers to go downstairs and switch it off. What takes priority over documenting the loss?

Accepted Answer

Keep everyone out until qualified personnel isolate the power and confirm safe entry.

Answer

Have the homeowner reach the main breaker first, then follow once the lights go out.

Answer

Pump from the stairway until the outlets are exposed, then begin the inspection.

Answer

Enter in rubber work boots while the homeowner remains upstairs to summon help.

Question 4

A lawsuit alleges that a retailer negligently secured a shelf that fell onto a customer. The alleged injury falls within the retailer's liability coverage, and the policy promises a defense against such suits. Surveillance footage strongly supports the retailer's position that the customer caused the shelf to fall. Does that evidence remove the insurer's defense obligation?

Accepted Answer

No; a strong defense on liability does not eliminate the contractual duty to defend.

Answer

Yes; the duty to defend begins only after the customer establishes the retailer's negligence.

Answer

Yes; the insurer need only reimburse defense costs if the retailer eventually loses the lawsuit.

Answer

No; the defense obligation also requires paying the customer's demand despite the contrary evidence.

Question 5

Police confirm a burglary at an occupied, furnished rental house. The burglars smashed an exterior door and stole freestanding furniture belonging to the landlord. The landlord's DP-2 policy insures both the dwelling and those contents; its named perils include damage by burglars, but no theft endorsement applies. The two claimed losses should be separated as follows:

Accepted Answer

The door damage is covered; the furniture theft requires coverage not provided here.

Answer

Both losses are covered; the forced entry makes the entire event a covered burglary.

Answer

Neither loss is covered; both resulted from theft, which requires an endorsement.

Answer

The furniture is covered under Coverage C; the door is excluded without a theft endorsement.

Question 6

While visiting her mother, an adult daughter who maintains her own permanent home trips over her suitcase and incurs $800 in otherwise eligible medical expenses. Her mother's homeowners policy has a $1,000 Coverage F limit and defines insured relatives as residents of the household. The mother asks, 'Does being family mean her bills are excluded?' Which reply is correct?

Accepted Answer

No. Coverage F can pay her eligible bills without proof of your negligence.

Answer

Yes. Coverage F excludes relatives of the named insured even when they live elsewhere.

Answer

Payment must wait for a court to determine whether you negligently caused the fall.

Answer

Coverage E pays once she submits the bills, whether or not you are legally liable.

Question 7

Two contractors submit kitchen-restoration estimates of $18,000 and $24,000 after a covered fire. Their unit prices are comparable, but the lower estimate lists half the verified drywall quantity and omits rewiring required by code. The applicable ordinance-or-law coverage pays for that rewiring. Neither party has demanded appraisal. Before using these estimates to negotiate, the adjuster should:

Accepted Answer

Add the missing drywall and covered rewiring to the lower estimate before comparing totals.

Answer

Average the two totals to give equal weight to the independent contractors' assessments.

Answer

Use the lower total because its individual unit prices are consistent with the competing bid.

Answer

Require an appraisal award before considering either estimate or authorizing any covered repair expense.

Question 8

In Michigan, an insured car strikes a neighbor's fence and an unrelated person's unoccupied car, which was properly parked without creating an unreasonable risk. The insured car is also damaged and carries collision coverage. Under the striking driver's policy, which allocation identifies the applicable coverages?

Accepted Answer

Property protection for the fence and parked car; collision for the insured car.

Answer

Residual property-damage liability for the fence and parked car; collision for the insured car.

Answer

Property protection for the fence; collision for both the parked car and the insured car.

Answer

Property protection for all three losses because each resulted from the same Michigan accident.

Question 9

A commercial building has a current replacement cost of $600,000 and a building insurance limit of $360,000. The owner also supplies an $800,000 appraisal of the land and building together. An 80% coinsurance condition applies to building replacement cost, with the $1,000 deductible taken after any coinsurance reduction. Completed repairs for a covered partial loss cost $80,000. How much is payable?

Accepted Answer

$59,000

Answer

$44,000

Answer

$47,000

Answer

$79,000

Question 10

A contractor finishes a staircase repair in November 2025. Its claims-made commercial general liability policy expires December 31, 2025, with a January 1, 2024 retroactive date and a 60-day extended reporting period. The staircase first fails and injures a visitor on January 12, 2026; the claim is first made and reported on January 20. The contractor argues that completing the work before expiration and reporting during the extension secures coverage. Which assessment correctly applies the policy's time trigger?

Accepted Answer

Not covered, because the bodily injury occurred after the policy period ended.

Answer

Covered, because the work was completed after the retroactive date and before policy expiration.

Answer

Covered, because the claim was first made and reported within the extended reporting period.

Answer

Not covered, because a claims-made policy cannot accept any claim reported after its expiration.

Free MI-ADJ Practice Questions

Domain 2: Insurance Basics 20% of exam

Question 1

Question 2

Domain 3: Dwelling Policy 5% of exam

Question 3

Domain 4: Homeowners Policy 12% of exam

Question 4

Domain 5: Automobile Insurance 15% of exam

Question 5

Question 6

Domain 6: Commercial Package Policy (CPP) 5% of exam

Question 7

Domain 9: Workers' Compensation Insurance 10% of exam

Question 8

Domain 10: Adjusting Losses 20% of exam

Question 9

Question 10

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