Study Resources for Illinois Public Adjuster Exam

Nov 30, 2025

Taking the public adjuster exam has some caveats, starting with the lack of official resources. The best resources for this exam are legal documents from DC, IDoI, and Illinois Law. Unfortunately, most of that feels like gibberish when you don't know much about the industry.

That's why we collected all of these resources, and some free online courses. In the next few sections, you'll find the topics you need to cover and their corresponding resources. By the end of this article, you should have a clear idea of what and how you should prepare.

Quick List of Resources for Adjuster Exam

The Illinois public adjuster exam includes 100 questions, divided into various categories. There are no official study materials, apart from a standard Pearson VUE outline.

Your best bet is free resources, an encyclopedia, or prep courses. Here are resources that will help you prepare for the exam:

Use Quizlet Flashcards as an improvised adjuster practice test. Alternatively, you can join our PA prep classes, where we teach you everything. Schedule a call or join our class; we're here to help you succeed in your career.

Homeowner's Policy

A homeowner's policy is a package policy that combines property and liability coverage for homeowners into a single contract. It protects the dwelling, personal property, and provides liability protection, covering multiple exposures under one policy.

The Insurance Information Institute (III) is a great free resource to understand a homeowner's policy. Please remember, each homeowner policy and its applications are different. You must adjust each insurance claim according to the unique situation.

Here's a brilliant video on homeowners' insurance to put things into perspective:

Standard Fire Policy

The Standard Fire Policy is the basic fire insurance contract that underlies property insurance. It covers direct loss by fire, lightning, and removal from endangered premises, and serves as the historical basis for modern property policies.

Please read the Standard Fire Policy of Illinois and the statutes for the fire policy. However, here's a quick breakdown of one to help you put things into perspective:

HO-1 through HO-8

Here's a quick rundown of all HO-1 to HO-8 forms:

HO-1 (Basic Form) covers 10 named perils but is rarely used today.
HO-2 (Broad Form) covers 16 named perils.
HO-3 (Special Form) is the most common homeowner policy and provides open perils coverage for the dwelling and named perils coverage for contents.
HO-4 (Renters) covers personal property and liability only, with no dwelling coverage.
HO-5 (Comprehensive) provides open perils coverage for both dwelling and personal property.
HO-6 (Condo) covers unit improvements and personal property for condominium owners.
HO-8 (Older Home) provides modified coverage when replacement cost exceeds market value.

The Encyclopedia Britannica explains each HO policy and its coverage. While not completely detailed, it is enough to outline the basic concepts.

Proof-of-Loss Forms

A Proof-of-Loss Form is a sworn statement detailing the amount of loss claimed by the insured. It must be submitted within a specified timeframe, typically 60 days after the insurer's request, and must include details about:

Damaged property
Cause of loss
Claimed amount

This form is required by the insurer before settlement can occur. You can find information about this online, like this guide that explains Proof-of-Loss forms.

Cancellation/Non-Renewal Provisions

Cancellation refers to policy termination before the expiration date with required notice, while Non-Renewal means the insurer decides not to continue coverage at policy expiration. Both require specific notice requirements, typically 30-60 days, and must have valid reasons as defined by state law.

Please understand the state provisions for cancellations and renewals. These can have a major impact on all potential cases and claims.

Pair and Set Clause

The Pair and Set Clause limits payment when part of a pair or set is damaged. The insurer is not obligated to pay the full value of the complete pair or set. Instead, they may repair or replace the damaged part or pay a fair proportion of the total value, which prevents a windfall to the insured.

Subrogation

Subrogation is the insurer's right to recover from a responsible third party after paying a claim. The insurer essentially "steps into the shoes" of the insured to pursue recovery. This prevents the insured from collecting twice for the same loss.

Subrogation isn't a part of a PA's responsibilities. However, knowing it can still help you approach different situations with greater confidence.

Non-Waiver Agreement

A Non-Waiver Agreement is a document stating that the insurer's investigation doesn't waive its right to deny coverage. This protects the insurer while investigating a claim, allows examination of the loss without admitting liability, and preserves all policy defenses.

Replacement Cost vs. Actual Cash Value (RPL/ACV)

Replacement Cost (RPL or RCV) is the cost to replace damaged property with new materials of like kind and quality, with no deduction for depreciation. Actual Cash Value (ACV) is the replacement cost minus depreciation, which reflects the age, wear, and condition of the property at the time of loss.

Xactimate helps you understand these terms and calculations. Plus, Xactimate is one of the most prominent software programs among claims adjusters. Getting acquainted with it early will be better for you down the road.

Businessowners Policy (B.O.P.)

A Businessowners Policy (B.O.P.) is a package policy designed for small to medium businesses that combines property and liability in a simplified contract. It includes coverage for the building, business personal property, business interruption, and liability in a pre-packaged format with limited customization.

Commercial Property Causes of Loss Forms

There are three Commercial Property Causes of Loss Forms that determine which perils are covered under the policy. The Basic Form covers 11 named perils, including fire, lightning, explosion, and windstorm.

The Broad Form covers all the Basic perils plus additional ones such as falling objects and the weight of snow. The Special Form provides open perils coverage, meaning all risks are covered except those specifically excluded.

Commercial Package Policy (CPP)

A Commercial Package Policy (CPP) is a flexible policy that combines multiple coverages into one contract. It can include property, liability, crime, inland marine, and other coverages, all with common declarations and conditions.

This makes it customizable for specific business needs. You have to understand these policies and how to handle them to pass the adjuster licensing exam.

Coinsurance

Coinsurance is a policy provision that requires the insured to carry insurance equal to a specified percentage of the property's value, commonly 80%, 90%, or 100%. If the insured is underinsured, the claim payment is reduced proportionally using the formula:

(Amount Carried ÷ Amount Required) × Loss = Payment.

This serves as a penalty for underinsurance. Every public adjuster should know about coinsurance to understand the gravity or relaxation of their claim.

Deductibles

A deductible is the amount the insured must pay out-of-pocket before insurance coverage begins. Types include flat dollar amounts, percentage deductibles, and franchise deductibles. Deductibles reduce premium costs and allow the insured to retain a portion of the risk.

Inland Marine Floaters

Inland Marine Floaters provide coverage for specific movable items such as jewelry, fine arts, cameras, musical instruments, and equipment. These items "float" from location to location, and the coverage often provides worldwide protection for these valuable possessions.

Inland marine floaters are either used as a separate policy or as an extension to a homeowner's policy. Pearson VUE emphasizes learning this and its implications for the public adjuster tests.

Valuable Papers and Records

Valuable Papers and Records coverage pays for the cost to research, replace, or restore important documents, including:

Books
Maps
Films
Drawings
Abstracts
Electronic data

It covers reproduction costs rather than the intrinsic value of the papers themselves, making it essential for businesses with critical documentation. You will be tested on this policy and its usage to validate your claim for the public adjuster license.

Occurrence vs. Claims-Made Policies

Occurrence policies cover incidents that occur during the policy period, regardless of when the claim is filed. Claims-made policies, on the other hand, cover only claims that are filed during the policy period, and the incident must also occur during the policy period or after the retroactive date. This distinction is important for long-tail liability exposures.

Legal Liability

Legal Liability coverage protects the insured for damage to the property of others in their care, custody, or control. It provides protection when the insured becomes legally liable for damage to non-owned property, which is common in bailment situations and fills gaps where standard property coverage may not apply.

Bond Principles and Types

Bonds are three-party agreements involving a principal, obligee, and surety that guarantee performance or honesty. Surety Bonds guarantee the performance of obligations such as contract completion, licensing requirements, or judicial matters. Fidelity Bonds protect against employee dishonesty.

Commercial Crime

Commercial Crime coverage protects businesses against employee theft, forgery, robbery, burglary, computer fraud, and other criminal acts. It can be written as a standalone policy or added to a commercial package and is essential for businesses handling money or valuable property.

Fidelity Bond

A Fidelity Bond protects employers against employee dishonesty, including theft, embezzlement, and fraud committed by employees. It can be written to cover individual employees or as a blanket bond covering all employees, and is critical for businesses where employees have access to funds.

Crime Insurance

Crime Insurance is similar to commercial crime coverage and protects against losses from criminal acts, including employee dishonesty, forgery, theft, and robbery. It may also cover computer fraud and other modern criminal activities.

Time Element Coverage

Time Element Coverage covers indirect or consequential losses resulting from property damage. Business Interruption coverage pays for lost income during the restoration period. Extra Expense coverage pays for additional costs needed to continue operations.

Rental Value coverage pays for lost rental income. Together, these coverages address the financial impact that goes beyond direct property damage.

Boiler and Machinery Insurance

Boiler and Machinery Insurance, also called Equipment Breakdown Insurance, covers sudden and accidental breakdown of equipment, including boilers, pressure vessels, mechanical equipment, and electrical equipment. It covers both repair costs and related business interruption losses.

FEMA-Flood Insurance

FEMA-Flood Insurance is provided through the National Flood Insurance Program (NFIP) administered by FEMA. Since standard property policies exclude flood coverage, a separate flood policy is required.

This coverage is available in communities that participate in flood management programs. Please read the extended FEMA Flood Insurance guide to identify coverage and value for public adjusters.

Leasehold Interest

Leasehold Interest represents a tenant's insurable interest in favorable lease terms. This coverage compensates the tenant for the loss if a below-market lease is canceled due to property damage.

Essentially, a leasehold interest protects the tenant in case of damage to the underlying property. A claims adjuster handles the negotiations and documentation for the loss.

Ordinance of Law

Ordinance of Law coverage pays for increased construction costs due to building codes. It has three elements:

The cost to demolish the undamaged portion of the building.
The increased cost of construction to meet current codes.
The loss of undamaged portions of the building.

This coverage is important when older buildings don't meet current codes and is triggered when building codes require upgrades after a loss.

Stated/Agreed Values

Stated or Agreed Values are predetermined values agreed upon by the insurer and insured at policy inception. This eliminates coinsurance requirements, and the stated amount becomes the maximum payable while suspending the coinsurance penalty.

FAQs on Resources for the Public Adjuster License

What skills should a claims adjuster have?

A claims adjuster should use strong analytical skills, clear communication, and precise documentation to evaluate claims. Claims adjusters also verify facts, calculate loss values, and negotiate settlements. These skills allow adjusters to resolve claims accurately, reduce errors, and protect compliance standards.

How to become a better adjuster?

Become a better adjuster by strengthening analytical skills, documenting claims with precision, and communicating clearly with policyholders. Improve performance by reviewing statutes weekly, practicing negotiation, and analyzing at least 10 to 20 closed claims per month to spot errors, refine valuation accuracy, and improve compliance.

What are the duties of an adjuster?

An adjuster investigates claims, evaluates damage, and determines coverage. Adjusters also interview witnesses, review policy language, document findings, and calculate payment amounts. These duties ensure accurate claim resolutions, prevent fraud, and protect compliance with state regulations.

Bottom Line on Resources for Public Adjuster Exam

There are no official resources for the Public Adjuster exam, so you're mostly on your own. This guide should have given you an idea of what and where you should start. Thankfully, most of the prep resources for the adjuster exam are free and available online.

Unfortunately, most of the terms in these resources will fly over your head unless you have some guidance. We highly recommend joining PA prep classes. We take 3 days to prepare you for everything that the exam and industry can throw at you. Join our PA prep classes today and step into the world of public adjusting!