There is a level cap on skills, depending on which book or teacher you learn the skill from, and which act you are in. The book Fergus drops teaches Identify up to level 2, so you can only put 2 skill points into it. Later in act 1, the weapons officer in the drill grounds can teach Identify to level 5 (as does the temple smith in act 3). Brian in the act 4 battlefield teaches it up to level 10.
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