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HI state law · part 2 of 2
Hawaii Adjuster Practice Test: Hawaii law, Part 2
15 more Hawaii law questions for the Hawaii Adjuster exam. Every explanation cites the statute or rule it is based on, so you can read the source when a rule surprises you. Start with part 1 on the main Hawaii adjuster page if you have not done it yet.
Subtopics in this part: Over-insurance, Hawaii Property Insurance Association, Auto liability minimums, Personal injury protection, Tort threshold, Uninsured motorist coverage, Total loss and betterment, Joint underwriting plan, Workers' compensation.
0 of 15 answered
Over-insurance · Challenging
Keala's house has a replacement cost of $420,000 and an actual cash value (replacement cost less depreciation) of $300,000. Under HRS 431:10E-102 and 431:10E-103, which coverage could a producer lawfully arrange?
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Correct answer: A. A replacement cost dwelling policy for $420,000
HRS 431:10E-102 bars knowingly writing coverage against the same hazard above the property's actual cash value, defined there as replacement cost less depreciation. HRS 431:10E-103 exempts insurance for the difference between actual value and the cost to repair or replace with new materials of like kind and quality, plus ordinance or law costs. Replacement cost coverage at $420,000 fits the exception; ACV coverage totaling $450,000 or $600,000 is over-insurance.
Under HRS 431:21-102, the basic property insurance that the Hawaii Property Insurance Association exists to make available covers direct loss from which perils?
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Correct answer: D. Those of the standard fire policy and extended coverage
HRS 431:21-102 defines basic property insurance as insurance against direct loss to real or tangible personal property from perils insured under the standard fire policy and extended coverage endorsement, and HRS 431:21-109 makes qualifying properties eligible for that coverage. The association provides additional coverages only when directed or approved by the commissioner and is not authorized to provide hurricane coverage.
Hawaii Property Insurance Association · Application
A homeowner in the Puna district on Hawaii Island, in lava zone 1, cannot obtain property insurance from licensed insurers. Which statement about the Hawaii Property Insurance Association (HPIA) is correct under HRS 431:21?
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Correct answer: B. She may apply, and HPIA may inspect the home within 10 days
HRS 431:21-107 makes properties in the commissioner-designated area of lava zones 1 and 2 that meet plan standards eligible for coverage through HPIA, and 2025 amendments added condominium associations. Under HRS 431:21-110, anyone with an insurable interest who cannot get basic property insurance from a licensed insurer may apply, and HPIA may inspect within ten days of the application. The article does not authorize HPIA to provide hurricane coverage.
A Hawaii personal auto policy issued in March 2026 carries only the bodily injury liability minimums required by HRS 431:10C-301(b). The insured causes a crash, and two injured people, both meeting the tort threshold, prove damages of $55,000 and $30,000. How much will the policy pay for bodily injury?
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Correct answer: C. $70,000
Since January 1, 2026, HRS 431:10C-301(b), as amended by Act 138 (2024), has set Hawaii's minimum liability limits at $40,000 per person and $80,000 per accident for bodily injury and $20,000 for property damage, up from 20/40/10. The first claimant is capped at $40,000 and the second receives the full $30,000, for $70,000, which fits within the $80,000 per-accident limit. The old minimums would have paid only $40,000.
Hoku, who carries only the basic personal injury protection required in Hawaii, incurs $14,200 in reasonable and appropriate medical and rehabilitation expenses after a crash. Under HRS 431:10C-103.5, how much will her PIP coverage pay?
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Correct answer: A. $10,000
HRS 431:10C-103.5(c) subjects personal injury protection benefits to an aggregate limit of $10,000 per person for the medical, hospital, rehabilitation and similar services listed in subsection (a). Insurers may offer additional coverage above $10,000, but Hoku has only the basic coverage. The $5,000 figure is the tort threshold in HRS 431:10C-306, not a benefit limit.
A PIP insurer received reasonable proof of the fact and amount of a provider's charges, along with a demand for payment, on May 1. It neither pays nor denies the bill. Under HRS 431:10C-304, what happens once 30 days pass?
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Correct answer: D. The unpaid benefits begin to bear interest of 1.5% per month
HRS 431:10C-304(3) requires PIP benefits to be paid within 30 days after the insurer receives reasonable proof of the fact and amount of benefits accrued and a demand for payment. A written denial with reasons, or an itemized list of needed documents, must also go out within those 30 days. Under paragraph (4), benefits still unpaid after 30 days bear interest at 1.5% per month.
Kai owns an insured car but is riding as a passenger in his friend Mele's insured car when another driver runs a red light and hits them. Under HRS 431:10C-305, which policy primarily pays Kai's personal injury protection benefits?
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Correct answer: B. Mele's policy, which insures the vehicle Kai occupied
HRS 431:10C-305(b)(1) makes PIP benefits payable primarily from the insurance on the vehicle the injured person occupied, or, for a pedestrian or bicyclist, from the insurance on the vehicle that caused the harm. Kai's own policy does not pay, because occupants of a vehicle other than the insured vehicle are not eligible, and no one may recover PIP from more than one insurer for the same accident. PIP is paid without regard to fault.
Noa's injuries from a Hawaii crash caused by an insured driver are not permanent, cause no disfigurement, and result in $3,800 of PIP benefits incurred. Under HRS 431:10C-306, can Noa sue the other driver in tort for pain and suffering?
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Correct answer: C. No, since the $5,000 PIP threshold is not met
HRS 431:10C-306 abolishes the tort liability of owners and operators of insured vehicles for accidental harm in Hawaii crashes, except when the injured person dies, suffers a significant permanent loss of use of a body part or function, suffers permanent and serious disfigurement causing mental or emotional suffering, or incurs PIP benefits that equal or exceed $5,000. Noa meets none of these, and fault alone does not open the tort option.
A driver insured in Hawaii runs a stop sign and causes $6,500 of damage to Ikaika's parked pickup, injuring no one. Under HRS 431:10C-306, can Ikaika recover the vehicle damage from the at-fault driver?
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Correct answer: D. Yes, because no-fault does not bar property damage claims
HRS 431:10C-306(f) states that nothing in the section abolishes tort liability for property damage arising from motor vehicle accidents. The tort limits and the $5,000 PIP threshold apply only to accidental harm, meaning bodily injury. Ikaika may claim against the at-fault driver's property damage liability coverage (at least $20,000 since 2026) or use his own collision coverage and let his insurer subrogate.
Under HRS 431:10C-301(b)(3), when may a Hawaii motor vehicle insurance policy be issued without uninsured motorist coverage?
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Correct answer: A. When any named insured rejects the coverage in writing
HRS 431:10C-301(b)(3) requires uninsured motorist coverage at no less than the minimum bodily injury limits unless a named insured rejects it in writing, and (b)(4) requires underinsured motorist coverage offered the same way, with the signature for rejection next to the offer. Insurers must also offer the option to stack UM and UIM coverage. An oral refusal is not enough, and PIP does not replace UM.
On a collision repair for a 12-year-old car, the appraiser documents measurable prior wear, rust and missing trim that reflect the car's overall condition and proposes a $650 betterment deduction for them. Under HRS 431:10C-313(c), what is the most the insurer may deduct for this damage?
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Correct answer: C. $500
HRS 431:10C-313(c) allows betterment deductions only if they reflect a measurable decrease in market value from poorer condition or prior damage and are itemized and documented in the claim file. For prior wear and tear, missing parts and rust reflecting the vehicle's overall condition, the deduction may not exceed $500, so the proposed $650 must be cut to $500. The insurer also may not require the insured to supply replacement parts.
An insurer pays Ronaldo a cash settlement for his totaled sedan. Within 30 days he cannot buy a comparable vehicle for the insurer's market value, but he has found, without buying it, one priced higher. Under HRS 431:10C-311(b), which response is allowed?
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Correct answer: A. Pay him the price difference or arrange the purchase for him
When, within 30 days of receiving a total loss cash settlement, the insured cannot buy a comparable vehicle for the insurer's market value and has located but not bought one priced higher, HRS 431:10C-311(b) requires the insurer to act: locate a comparable vehicle at its valuation through licensed dealers, pay the difference or negotiate the purchase, or conclude the loss by appraisal. Subsection (c) prohibits get ready to go and dealer prep deductions.
Siosaia asks an insurer's producer for an appointment to apply for motor vehicle insurance, and 15 working days pass without an application or rate quote. Under HAR 16-23-13, what follows?
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Correct answer: B. It is deemed a rejection, so a joint underwriting plan offer is due
HAR 16-23-13 requires an insurer and its producer to provide an application and rate quote within 15 working days of a request for an appointment, and failing to do so is deemed a rejection. After a rejection, the insurer and producer must meet with the applicant within ten working days and offer to place the coverage with the joint underwriting plan, as HRS 431:10C-110 requires. HPIA is a property plan, not an auto plan.
A Hawaii worker with an average weekly wage of $1,050 is temporarily and totally disabled by a work injury for 17 calendar days. Assuming the rate falls within the state minimum and maximum, how much temporary total disability is payable under HRS 386-31(b)?
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Correct answer: D. $1,400
HRS 386-31(b) pays temporary total disability at 66 2/3% of the average weekly wage, within the state minimum and maximum, for the duration of the disability but not including the first three calendar days. The weekly rate is $1,050 x 2/3 = $700, or $100 a day. Payable days are 17 - 3 = 14, so the benefit is 14 x $100 = $1,400. The first payment is due by the tenth day after the employer learns of the disability.
Under HRS 386-82, unless a special rule for certain toxic or radiation exposures applies, a Hawaii workers' compensation claim is barred unless a written claim is made to the director within what time limits?
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Correct answer: A. 2 years after effects manifest, and 5 years after the accident
HRS 386-82 bars compensation unless a written claim is made to the director of labor and industrial relations within two years after the effects of the injury become manifest and within five years after the accident or occurrence. Claims for certain carcinogen, compressed air and radiation exposures must instead be made within two years after the worker knows the employment caused the injury. Employers separately report injuries within seven working days under HRS 386-95.