Insurance MCQ

One aspect of good-faith claim handling is the fair evaluation of the claim. A fair approach to evaluating liability claims is for the claim representative to evaluate them A. As if no coverage limit existed. B. From the claimant's perspective. C. As they relate to similar claims with similar coverage and limits. D. By forming a claim committee for the purpose of achieving greater impartiality. Answer: A

In liability claims, the claimant is referred to as the A. Primary party. B. First party. C. Second party. D. Third party. Answer: D

A liability adjuster must be concerned with specific, out-of-pocket expenses when evaluating the damages being claimed. The technical term for such expenses is A. Special damages. B. Punitive damages. C. General damages. D. Measurable damages. Answer: A

Jorgen is a claim supervisor who is devising a new response plan for his employer so that it can handle catastrophe claims more effectively. All of the following are factors he should consider, EXCEPT: A. Retaining independent adjuster firms B. Requesting that personnel staff temporary claim offices without pay. C. Increasing the role of producers through increased settlement authority D. Giving the policyholder the benefit of any doubt as to the valuation of property Answer: B

Which one of the following statements is true regarding elements of good-faith claim handling? A. A claim file's medical bills, doctors' reports, and other information on each claimant should be in chronological order. B. Once contact with the insured is made, the claim representative should acknowledge and assign the claim. C. Claim representatives should use policy provisions, such as arbitration clauses, when applicable, to resolve disputes over the settlement amount. D. Generally, the first activity of the insurer in the claim handling process involves two functions—investigating the claim and concluding the claim. Answer: C

Marvin suffered a fire loss at his residence. The claim representative valued several antiques at a very low price. Marvin refuses to settle his claim with his insurer. Which one of the following is Marvin's recourse? A. Marvin's only recourse is to sue the insurer for coverage and damages to the property. B. Marvin may follow the appraisal provision in the policy to settle the dispute over the value of the damaged property. C. Marvin may obtain a quote from a certified antique dealer to determine the value the insurer must pay. D. Marvin may choose to arbitrate the value of the antiques before a judge. Answer: B

A goal of the claims function is to support the profit goal of the A. Insured. B. Claimant. C. Insurer. D. Policyholder. Answer: C