Florida Property & Casualty Insurance Practice Exam Free - 2026

• A. 20 percent of the claim payment
• B. 10 percent of the claim payment, exclusive of attorney fees and costs
• C. 15 percent of the claim payment
• D. No fee cap applies during a declared emergency

Correct answer: B. 10 percent of the claim payment, exclusive of attorney fees and costs

Explanation: For claims based on events that are the subject of a gubernatorial declaration of a state of emergency, a public adjuster's fee is capped at 10 percent of the insurance claim payments or settlements, exclusive of attorney fees and costs, and the cap applies to claims made during the year after the declaration. The 20 percent cap applies to claims not tied to a declared emergency; 15 percent and 'no cap' are not in the statute. The insured may also cancel the contract without penalty within 10 days (or, for emergency claims, 30 days after the loss if longer). See Fla. Stat. § 626.854(11).

• A. Participation is optional and the fund reimburses 100 percent of hurricane losses above a retention
• B. The fund is administered by the Office of Insurance Regulation and covers windstorm, flood, and hail
• C. The fund reimburses residential insurers for named storms and tropical depressions declared by the Governor
• D. Participation is a mandatory condition of writing residential property insurance, and the insurer selects reimbursement of 45, 75, or 90 percent of its losses from each hurricane declared by the National Hurricane Center

Correct answer: D. Participation is a mandatory condition of writing residential property insurance, and the insurer selects reimbursement of 45, 75, or 90 percent of its losses from each hurricane declared by the National Hurricane Center

Explanation: Every residential property insurer must enter a reimbursement contract with the FHCF as a condition of doing business in Florida, and it selects coverage for 45 percent, 75 percent, or 90 percent of its losses from each covered event, which is any one storm declared to be a hurricane by the National Hurricane Center that causes insured losses in Florida. The fund is administered by the State Board of Administration, not the Office of Insurance Regulation, and its reimbursement obligation is limited to its claims-paying capacity up to $17 billion per contract year. Participation is not optional, it does not pay 100 percent, and it does not cover flood or hail or storms that are merely declared by the Governor. See Fla. Stat. § 215.555.

• A. $250,000, the amount for which the property was insured
• B. $200,000, the actual cash value
• C. The lesser of the two figures, minus depreciation
• D. $250,000 only if the insured elects replacement cost coverage

Correct answer: A. $250,000, the amount for which the property was insured

Explanation: Florida's valued policy law provides that when a building or structure is a total loss caused by a covered peril, absent a change increasing the risk without the insurer's consent or fraud by the insured, the insurer's liability is the amount for which the property was insured as specified in the policy and for which a premium was charged and paid. Actual cash value and depreciation do not reduce the payment for a total loss, and no replacement cost election is required. The rule does not apply when the loss is caused partly by a noncovered peril unless the covered peril alone would have caused the total loss, and a partial loss by fire or lightning is paid at the actual amount of the loss up to the policy limit. See Fla. Stat. § 627.702.

• A. 45 days
• B. 90 days
• C. 120 days
• D. 60 days

Correct answer: C. 120 days

Explanation: For personal lines and commercial lines residential property policies such as homeowners, the insurer must give the first-named insured at least 120 days written notice of nonrenewal, cancellation, or termination. The general standard for other property and casualty lines is 45 days. See Fla. Stat. § 627.4133.

• A. A surety bond guaranteeing the project owner will pay the contractor on schedule
• B. A surety bond guaranteeing a contractor will pay subcontractors and suppliers
• C. A surety bond guaranteeing a contractor will finish the project as specified
• D. A surety bond guaranteeing a contractor will enter into the contract once the bid is awarded

Correct answer: B. A surety bond guaranteeing a contractor will pay subcontractors and suppliers

Explanation: A payment bond guarantees that the contractor will pay all subcontractors, laborers, and material suppliers. It protects these parties when they cannot place liens on public projects.

• A. A surety bond guaranteeing the contractor will complete the work according to the contract
• B. A surety bond guaranteeing the owner will award the contract to the lowest responsible bidder
• C. A surety bond guaranteeing a contractor will enter into a contract if awarded the bid
• D. A surety bond guaranteeing the contractor will pay all subcontractors and material suppliers

Correct answer: C. A surety bond guaranteeing a contractor will enter into a contract if awarded the bid

Explanation: A bid bond guarantees that if the bidder is awarded the contract it will enter into that contract and furnish the required performance and payment bonds. If the winning bidder backs out, the surety pays the owner the difference between that bid and the next acceptable bid, up to the bond's penal sum. Guaranteeing payment to subcontractors and suppliers is the job of a payment bond, and guaranteeing completion of the work is the job of a performance bond.

• A. An examination under oath (EUO)
• B. An appraisal
• C. A deposition in a lawsuit
• D. Arbitration

Correct answer: A. An examination under oath (EUO)

Explanation: The duties-after-loss conditions of property policies commonly let the insurer require an examination under oath while investigating a claim. It is contractual and happens before any lawsuit; unreasonably refusing to sit for one can jeopardize the claim. It differs from a deposition, which is part of litigation, and from appraisal, which resolves disputes over the amount of a covered loss.

• A. Coverage A
• B. Coverage E
• C. Coverage C
• D. Coverage B

Correct answer: A. Coverage A

Explanation: Coverage A generally applies to the dwelling. Other homeowners coverage parts apply to other structures, personal property, liability, or loss of use depending on the policy form.

• A. Coverage F - Medical Payments
• B. Coverage B - Other Structures
• C. Coverage C - Personal Property
• D. Coverage A - Dwelling

Correct answer: B. Coverage B - Other Structures

Explanation: Coverage B is commonly used for other structures on the residence premises, such as a detached garage, shed, or fence, subject to policy conditions and exclusions.

• A. To insure detached structures such as a garage or shed
• B. To insure the dwelling and structures attached to it
• C. To insure personal property owned or used by an insured
• D. To pay additional living expenses when the home is unfit to live in

Correct answer: C. To insure personal property owned or used by an insured

Explanation: Coverage C generally applies to personal property. Candidates should remember that special limits and exclusions may apply to certain categories of property.

• A. Damage to other structures on the premises
• B. Medical payments to injured guests
• C. Personal liability for injury to others
• D. Loss of use or additional living expense

Correct answer: D. Loss of use or additional living expense

Explanation: Coverage D is commonly associated with loss of use, including additional living expense when a covered loss makes the residence unfit to live in.

• A. Coverage E
• B. Coverage F
• C. Coverage B
• D. Coverage C

Correct answer: A. Coverage E

Explanation: Coverage E is commonly the personal liability coverage in a homeowners policy. It may respond when an insured is legally liable for covered bodily injury or property damage.